Standard and Poor's examines the effects of pension reform on insurer demand for infrastructure in Insurance ERM

The Chancellor’s recent pension reforms have raised concerns about a slowdown in annuity-sales and the potential knock on effect on insurers’ demand for infrastructure assets.

However, Michael Wilkins, Managing Director of Infrastructure Ratings, and Oliver Herbert, Insurance Analyst, of Standard & Poor’s Ratings Services, discuss in Insurance ERM why they believe that – despite the regulatory change – bulk-annuity sales are likely to remain strong and the potential market for individual annuities will remain very large. What’s more, in a smaller market, insurers will need to offer annuities with more competitive rates – which must be offset against higher-yielding assets like infrastructure projects, therefore boosting demand.

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