“Whenever they run into a brick wall of resistance, they try and find a way around it,” he says. “There are plenty of investment banks out there that are willing to help and to offer their expertise. A lot of the pricing around some of their solutions is a bit murky, so you have to dig pretty hard to get to the bottom to compare one against the other. But overall it’s an area of increasing interest and there’s plenty of alternatives out there to consider.” Matterson sees funds looking to take on a large part of the responsibility for manufacturing these solutions, potentially through an implemented consulting route and then partner with an insurer to some extent, or with someone else to get the guaranteed component. “We’ve seen increasing interest in these approaches from our clients and continue to work with them to identify and implement appropriate strategies as well as the necessary tools and communications to support them.”

“There are a number of issues. The first is cost. The products continue to be expensive which creates pressure to sell, and funds without the sales force behind them see that as a challenge. “The other major aspects are counterparty and control. It’s potentially a long-term product and guarantee, so hooking up with a provider for 30 years becomes a logistical nightmare because portability is sacrificed.” Matterson concludes this is not a product solution. “You can’t just build a product and think that that’s now solved all the problems. It’s a much broader debate than that because it’s about engagement, advice and how circumstances change over time. It’s having the right kit of solutions for members and their needs which are going to change, not just at retirement but also as they experience retirement as well.”