This section looks at the changes to the SIPP landscape in relation to providers, product development and the effect of the government through the two recent budgets on the pension industry.
Product providers
The past year has not seen as many changes in the provider arena as in the previous twelve months when there were a number of new entrants as well as product launches from existing providers. A number of providers also disappeared. We envisaged there would be consolidation amongst SIPP providers. A number of smaller providers are looking to merge with larger companies as the FSA is likely to require companies to maintain considerable cash holding to cover future expenses. This requirement will put great pressure on the capital of many providers.
Mergers
Santander has pulled out of the market by selling James Hay business to the Dublin based IFG Group. The latter market a SIPP through IPS Partnership which was created by a merger in 2008. Mattioli Woods have bought the SIPP business of Cooper Parry.
New entrants
Carey Pensions, a UK offshoot of a Guernsey pension administrator is new to the SIPP market. Carey has introduced two products, a full SIPP and a personal pension which has limited investment opportunities but which can grow to the full SIPP if required. Aviva withdrew their product from general sale in 2009 and launched a revised SIPP product, Aviva SIPP in early 2010 at the same time as launching the Aviva Wrap
Departures
Alico Wealth Management has withdrawn their SIPP offering at the same time launching a retirement solution that invests in carefully selected funds. AXA have withdrawn their SIPP and now market 'The One' from Winterthur under AXA Wealth.
Hornbuckle Mitchell has divested themselves of their advisory business allowing them to concentrate on pension administration through their SIPP products and Small Self Administered Schemes
SIPP product development
Changes in the SIPP product arena over the past year have seen a number of new products launched and a move towards a simplified product. The simplified SIPP usually has a choice of investment arenas to a maximum of two before full SIPP costs are imposed. Frequently the investments offered are through a fund supermarket, stockbroker or a discretionary fund manager.
The advantage to an investor is that they can invest through in funds or shares of their choice without being limited by the restrictions of a life company or having to pay full SIPP fees.
The following products are examples of recent product launches;
Carey Pensions - Personal Pension
Curtis Banks - Brooks Macdonald MPS SIPP
Dentons Pensions Management - Single Portfolio SIPP
Hornbuckle Mitchell - Single Investment Private Pension
The Lifetime SIPP Company has launched the Complete Lifetime SIPP which enables the member to adopt various options from a simple SIPP leading to a full SIPP.
Two insured providers have either launched a new product or realigned their products towards personal pensions which have the ability to develop to a full SIPP also offering a drawdown facility.
Scottish Widows - The Retirement Account
Standard Life - active money SIPP
For further details on the current UK SIPP Market, why not download the full Adviser Review by Defaqto at www.defaqto.com/adviser/ifa/guides