UK retirement incomes from annuities will be cut once new European rules are laid down
French insurer, Axa has announced that UK retirement incomes from annuities will be cut once new European rules are laid down – reported in Reuters.
According to the company, the UK annuity providers are likely to have to increase the capital and cut payouts to pensioners due to European Union rules set for 2012. The chief executive of life insurer Legal & General has warned that the value of UK pension savings is threatened with a 10-20% cut under the new EU rules.
Nicolas Moreau, chief executive of Axa UK, said: “People will get less return for their pensions, but they have had too much of the profits because it is such a competitive market.”
Additionally, Axa has reported a fall in its first half earnings.