Strong growth of 72% was reported in Dublin, compared with the first half of 2016, while the Isle of Man reported a rise of 33% in offshore bond sales.
Total assets under administration rose to £14.6bn at the end of June, £2bn up on June 2016 representing a 15% increase.
The latest ABI market share data saw an increase for Canada Life International to 28% in Q1 2017, up from 25% in Q4 2016.
Offshore renaissance
Sean Christian, Canada Life’s executive director for its international businesses, told International Adviser that he believes there are a number of reasons for the offshore bond renaissance, which has seen industry rivals Old Mutual International, Utmost Wealth Solution and Standard Life adding or expanding products in the past few months.
“The resident non-dom changes open up new opportunities for offshore bonds,” he said. “If an individual is to lose their RND status then wrapping permissible assets in an offshore bond is a tax-efficient planning vehicle for their needs.”
Changes in how advisers operate are also driving renewed interest in the product, Christian said.
“Our view is that adviser focus is returning to longer-term tax planning solutions after a couple of years of being focused on pension planning following changes to the legislation.”
New disclosure requirements under the Common Reporting Standard (CRS) has seen advisers increasingly “attracted to mainstream, tax compliant solutions that have been in the market for decades”, he added.
“An offshore bond could not be more transparent, being fully in line with UK tax legislation and the obligation on the life company to report chargeable events to HM Revenue & Customs,” Christian told IA.
Gap in the market
He said: “Our 2017 year-to-date results reflect the successful ongoing execution of our strategy, which was formulated last year. The strategy identified the continued importance of institutional sales to our business, whilst at the same time highlighting an opportunity to increase our penetration of the UK retail market.
“Our dual jurisdiction proposition and product range offers flexibility and choice to advisers and their clients. The addition of a capital redemption bond option from both our Isle of Man and Dublin businesses has proved to be very attractive, with the Dublin version in particular addressing an obvious gap in the market.
“Our estate planning sales are also strong this year and we have seen increased demand for our protection products which are used to cover potential liabilities to UK inheritance tax.
“This product is particularly attractive to UK resident non-domiciled individuals looking for an offshore protection solution.”
UK commitment
Christian added: “The increases in new business, assets under administration and market share are extremely pleasing and an endorsement of our long-term strategy of being committed to our chosen market, the UK.
“Through not having external distractions, such as the challenges that currently exist in overseas markets, we fully focussed on understanding the needs and wants of UK advisers and their clients.
“I firmly believe that these advisers and their clients value our financial strength, longevity and market commitment over the last 30 years at a time when the industry is seeing a great deal of consolidation and change”.
