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Insurers lobby on pensions amidst falling sales

Date: Wed, 27 Aug 03 Analysis

LONDON, UK - The UK Government has been urged to take swift action to arrest an alarming decline in sales of pension and life insurance products.

The Association of British Insurers has noted that annualised sales have now fallen by 17.8 per cent in the second quarter of 2003 to £2.44 bn against £2.97 bn in the equivalent period in the previous year.

For the year to date sales have fallen by an estimated 15.4 per cent.

Sales of pension products have now fallen to reach approximately the same the level as when the Government first launched stakeholder pensions in April 2001.

Francis McGee, ABI head of strategy, has told the Daily Telegraph that while sales had suffered from the current bear market in equities, the Government's financial services policy had to bear some of the blame.

'There is a real need to create a charging structure to enable companies to spend the money needed to provide advice to consumers. "Stakeholders are simple but the pensions market is not. It is widely accepted that people need persuasion and help to do what is the right thing and save for their futures,' said McGee.

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