Innovation of the year - SEB Pension

In a year that has witnessed variable annuity providers massively scale back the level and increase the cost of the benefits they offer, Denmark’s SEB Pension has constructed a product that bucks the trend, raising the level and reducing the volatility of their payouts without ramping up their cost. Laurie Carver reports

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A combination of sharply dipping asset prices and low interest rates has posed serious problems for variable annuity providers in meeting generous pre-crisis guarantees. The result has been a retreat from such generosity, with benefits being scaled back, and their costs raised.

Paris-based Axa raised the price on the guaranteed minimum income benefit on its Accumulator variable annuity (VA) from 65 basis points to 80bp and slashed the number of funds available to invest in by half. Another of

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