Table of Contents
Introduction
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- Product definitions
- Abbreviations
Executive Summary
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- The market
- Slowdown in new SIPP business
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- Figure 1: Forecast of new SIPP premiums (at current prices) – fan chart, 2007-17
- Transfer activity
- Future prospects
- In-force business
- Market factors
- Regulatory developments
- Economic and investment environment
- Rival products
- Companies, brands and innovation
- Product innovation
- Market composition and key providers
- Distribution mix: adviser sales dominate
- The consumer
- Market penetration and investment approach
- SIPP contributions
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- Figure 2: Amount contributed to SIPP per month, July 2012
- Monitoring activity
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- Figure 3: Frequency of monitoring SIPP performance, July 2012
- Investor satisfaction
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- Figure 4: Level of satisfaction with SIPP performance, July 2012
- SIPP attributes
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- Figure 5: Top six most liked features of a SIPP, July 2012
- Current financial situation and prospects
- Financial objectives
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- Figure 6: Top six financial goals over the next 12-18 months, by SIPP investors and prospects, July 2012
- What we think
Issues in the Market
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- What’s in a name?
- Is the boom over?
- Should there be a standardised list of allowable investments?
- What impact will the new platform rules have on the SIPP market?
- Is the reduction in GAD levels stifling SIPP transfer business?
Trend Application
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- Develop simplified propositions with tools that assist clients’ decision-making and investment choices
- It’s an opportune time to tackle the pensions gender gap
- 2015: Brand Intervention
Market Drivers
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- Key points
- Main factors shaping the market’s development
- Regulatory developments
- Issues affecting the wider pension industry
- Overview of macroeconomic factors influencing investor behaviour
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- Figure 7: Impact of economic downturn and eurozone crisis on investment attitude/approach – top six responses by SIPP investors, July 2012
Competitor Products – Pension Market Overview
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- Key points
- A large share of the adult population have limited or no pension savings
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- Figure 8: Ownership of private pension, by product type, by gender, January 2012
- Workplace pension reforms could reduce personal pension participation
- SIPPs account for a small proportion of total individual pension sales…
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- Figure 9: Number of new individual pension contracts (including GPPs), by product type, 2007-11
- …but represent a third of all new premiums
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- Figure 10: Value of new individual pension business (including GPPs), by product type, 2007-11
- Outside of the transfer market, SIPPs face some competition from SSASs
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- Figure 11: Value of new EPP and SSAS business, 2007-11
Market SWOT Analysis
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- Figure 12: UK SIPP market – SWOT analysis, 2012
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Who’s Innovating?
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- Key points
- Market expansion and new entrants have driven SIPP innovation
- The new RDR regime is fuelling activity in the platform sector…
- …with more to follow
- Trade body looks to speed up transfer times
Market Size and Forecast
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- Key points
- Rapid market expansion
- 2012 is expected to record a fall in new SIPP business
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- Figure 13: Volume and value of new SIPP business, 2008-12
- Mintel expects strong growth in new business to continue
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- Figure 14: Forecast of the number of new SIPP sales – fan chart, 2007-17
- Figure 15: Forecast of the value of new SIPP premiums – fan chart, 2007-17
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- Figure 16: Forecast of new SIPP business, at current and constant prices, 2002-17
- Forecast methodology
- Fan chart explanation
Segment Performance
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- Key points
- Non-insured versus insured SIPPs
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- Figure 17: Value and volume of new SIPP business, by insured and non-insured business, 2009-12
- Average premiums are much higher in the non-insured sector
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- Figure 18: Average new premium, by insured and non-insured business, 2009-12
- The non-insured sector has a much higher transfer rate
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- Figure 19: Value of SIPP transfers and share of total single premiums, 2009-12
Market Share
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- Key points
- A fragmented market poised for consolidation
- Standard Life retains market leader position for third year running
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- Figure 20: Top ten SIPP providers, by value of in-force business, 2012 (mid-year)
- Other significant players
- Notable third-party administrators
Companies and Products
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- Standard Life
- Company description
- Position in the market
- SIPP product range
- Distribution mix
- Recent financial performance
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- Figure 21: Interim financial data for Standard Life UK, H1 2011 and H1 2012
- Figure 22: Annual financial data for Standard Life UK, 2010 and 2011
- Recent activity
- AJ Bell
- Company description
- Position in the market
- SIPP product range
- Distribution mix
- Recent financial performance
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- Figure 23: Interim financial data for AJ Bell, H1 2011 and H1 2012
- Figure 24: Annual financial data for AJ Bell, 2010 and 2011
- Recent activity
- James Hay Partnership
- Company description
- Position in the market
- SIPP product range
- Distribution mix
- Recent financial performance
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- Figure 25: Annual financial data for IFG Group, 2010 and 2011
- Recent activity
- Future plans
- AEGON
- Company description
- Position in the market
- SIPP product range
- Distribution mix
- Recent financial performance
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- Figure 26: Interim financial data for AEGON UK, H1 2011 and H1 2012
- Figure 27: Annual financial data for AEGON UK, 2010 and 2011
- Recent activity
- Hargreaves Lansdown
- Company description
- Position in the market
- SIPP product range
- Distribution mix
- Recent financial performance
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- Figure 28: Annual financial data for Hargreaves Lansdown, 2011 and 2012
- Recent activity
- Future plans
- Suffolk Life
- Company description
- Position in the market
- SIPP product range
- Distribution mix
- Recent financial performance
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- Figure 29: Annual financial data for Suffolk Life Pensions, 2010 and 2011
- Recent activity
- Hornbuckle Mitchell
- Company description
- SIPP product range
- Distribution mix
- Recent financial performance
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- Figure 30: Annual financial data for Hornbuckle Mitchell, 2010 and 2011
- Recent activity
Brand Communication and Promotion
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- Key points
- Adspend on pension products continues to decline
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- Figure 31: Total advertising expenditure on pensions and retirement income solutions, by sub-category, 2008-12
- DWP is the top pensions advertiser in the year to August 2012
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- Figure 32: Top ten advertisers of pensions and retirement income solutions, 2010-12
- The press accounts for the largest share of pensions adspend
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- Figure 33: Proportional distribution of adspend on pensions and retirement income solutions, by media type, 2010-12
- Figure 34: Proportional distribution of adspend on pensions and retirement income solutions, by media type, 2010-12
Channels to Market
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- Key points
- IFAs generate the largest share of SIPP business…
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- Figure 35: New insured SIPPs premiums, by sales channel, 2009-11
- …while non-intermediated sales are still rare, but growing
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- Figure 36: New non-insured SIPPs premiums, by sales channel, 2009-11
- Platform revolution
Asset Ownership and Investment Approach
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- Key points
- Survey background
- SIPP investors tend to be wealthy
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- Figure 37: Wealth profile of SIPP investors versus prospects, by level of investable assets, July 2012
- There are around 7.6 million UK adults with investable assets of £50K+
- Ownership of savings, investments and pensions
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- Figure 38: Pensions, investments and other assets held, by SIPP investors and prospects, July 2012
- Just over two fifths of SIPP investors favour a self-directed approach
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- Figure 39: Approach to investment management and decision-making, by SIPP investors and prospects, July 2012
Investor Attitudes and Behaviour
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- Key points
- Around a quarter of investors say they arranged their SIPP directly with their provider
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- Figure 40: Method of arranging SIPP, by level of investable assets, July 2012
- Just over half are making monthly contributions to their SIPP
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- Figure 41: Amount contributed to SIPP per month, by asset level, July 2012
- Most investors keep a regular check on their SIPP’s performance
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- Figure 42: Frequency of monitoring SIPP performance, by asset level, July 2012
- One in seven are dissatisfied with their SIPP’s performance
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- Figure 43: Level of satisfaction with SIPP performance, by asset level, July 2012
- The top three selling points of a SIPP are tax benefits, greater control and choice of investments
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- Figure 44: Most liked features of a SIPP, by asset level, July 2012
Impact of External Factors on Investment Behaviour
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- Key points
- Ongoing concerns over the eurozone crisis and domestic economy have made SIPP investors more cautious
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- Figure 45: Impact of economic downturn and eurozone crisis on investment attitude/approach, by SIPP investors and prospects, July 2012
- A third of SIPP investors say that they are worse off than a year ago…
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- Figure 46: Current financial situation compared to 12 months ago, by SIPP investors and prospects, July 2012
- …but there is greater optimism looking forward
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- Figure 47: Financial wealth expectations over the next 12 months, by SIPP investors and prospects, July 2012
Financial Goals and Investment Plans
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- Key points
- Wealth accumulation is the top financial goal for SIPP investors
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- Figure 48: Financial goals over the next 12-18 months, by SIPP investors and prospects, July 2012
- A fifth of SIPP investors expect to add to their pension savings over the coming year
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- Figure 49: Assets expect to buy, sell or maintain over the next 12 months, by SIPP investors and prospects, July 2012
Appendix – Definitions of Related Pension Products
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- Figure 50: Types of private pension provision, UK
- The decumulation or ‘at-retirement’ market
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- Figure 51: Overview of the annuity and retirement income market, 2011
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