AXA Wealth UK has considered entering the fixed term annuity market but has decided not to launch a product soon, said chief executive Mike Kellard.
Living Time is the leading player in the fixed-terms market and MetLife currently distributes their products. However, Aviva and Just Retirement will soon launch their products this year as the market is expected to grow exponentially.
AXA Wealth currently sells its Secure Advantage range of variable annuity products.
“We do not currently offer a fixed-term product and we have not got any immediate plans to enter the market. We have looked at fixed-term annuities but we have launched the Secure Advantage range and we want to see where that goes first”, said Kellard.
Kellard said that splitting the wealth business from the life business – which was acquired by Resolution for £2.75 billion, was a “painful experience”, while talking about the 41% growth in wealth business revenue in 2010.
“Last year, we had a massive distraction with the Resolution deal. It was a painful experience to go through and we still have some work to do finalising that”, he said.
“The AXA Life business had people who worked on both parts of the businesses, so it was not something that could be broken up easily”, he added.
“Fixed-term annuities are a price-sensitive market and AXA Wealth may not think it can compete on price”, commented Bob Bullivant of Annuity Direct.