The pension provider said 92% of the advisers it surveyed said they expected drawdown products to be part of their retirement service offerings, though 89% planned to recommend enhanced annuities as their solution to client’s needs and 80% will offer conventional annuities.
The Government’s pension reforms, which took effect from 6 April this year, allowed people with defined contribution pension pots unrestricted lump sum withdrawals from their savings after age 55, ending a long standing and increasingly unpopular requirement for retirees to buy annuities.
Canada Life said that overall, financial advisers were expecting or already experiencing a large influx of new business as a result of the pension changes.
The advisers surveyed reported that only 16% of their clients understood the new freedoms with nine out of 10 advisers expecting this to result in a rise in people seeking financial advice.
“The pension freedoms have introduced many more options for clients, and advisers are enthusiastic that this means more of them will seek guidance or advice,” said Nick Harding, propositions and marketing director, distribution at Canada Life.
However, as a result of the increased workload and the greater choice of products on offer, the advisers said they need more information from providers on the details of new products. Around 55% of advisers said they had not received enough information on the range of options they are offering.
Three quarters of those surveyed also said they expected the new freedoms to result in a heightened risk of negligence claims against them for giving bad advice.
“The pension freedoms have effectively reset the retirement income market so there is a very important role to play for providers like ourselves to help advisers do their jobs well,” said Harding.
“The changes have been very favourably received by consumers and we as an industry have a responsibility to ensure clients have a protected income throughout retirement.”
