The effect of the reforms to compulsion on annuity demand

Edmund Cannon, Ian Tonks, Robert Yuille

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This paper investigates the effect of recent regulatory changes to the compulsory annuitisation of tax-privileged pension savings, on the demand for annuities and other retirement products. We find that the demand for annuities has fallen by
almost 75 per cent from its peak in 2012, and the demand for income drawdown products has increased. There is some evidence that people at younger ages and with smaller pension pots are choosing not to annuitise, and hence the average
size of an annuity purchase has increased.
Original languageEnglish
Pages (from-to)R47-R54
JournalNational Institute Economic Review
Issue number1
Publication statusPublished - 1 Aug 2016


  • insurance markets; annuities; drawdown


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