Bulk purchase of enhanced annuities offers growth potential

The UK market for defined benefit pension scheme buy-ins is expected to surge as annuity writers seek to diversify their mix of business in the wake of pension reforms. Lucrative opportunities can be found in the niche medically underwritten space, but such transactions require specialist expertise and carry their own unique risks. Louie Woodall investigates what it takes to succeed in this growing market

In the UK, provision of enhanced annuities to retail clients has grown in leaps and bounds since they first entered the market as ‘smokers’ annuities’ in 1995. Just Retirement, an enhanced annuities specialist, reports the UK market has grown by 30% since 2007 alone. With conventional annuity rates hovering at near-record lows, increasing numbers of retirees are testing their eligibility for these products, which offer higher payments to those with health issues that may reduce their life