Annuity sales rose across a range of product types in 2025/26, with value protected, escalating and enhanced annuities all recording strong growth.
Canada Life’s analysis of the latest Financial Conduct Authority retirement income market data also shows a rise in open-market annuity sales.
Sales of value protected annuities increased 38% to 8,737 from 6,346 a year earlier. They now account for 9% of total annuity sales, up from 4% in 2021/22, although they remain the smallest category.
Escalating annuity sales rose 27% to 22,099 from 17,427. These products provide an income that increases over time, either in line with inflation or by a fixed percentage.
Enhanced annuity sales increased 25% to 52,764 from 42,339, meaning they accounted for more than half of all annuity sales for the first time.
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Enhanced annuities can provide higher incomes to retirees with health conditions or lifestyle factors that may affect life expectancy.
Open-market annuity sales also rose 19% to 64,891 from 54,606, indicating more customers are shopping around for annuity rates and products.
Kris Black, head of annuities at Canada Life, said the rise in open-market annuities showed more customers were shopping around for products suited to their needs.
“Growing take-up across a wider range of annuity options shows that awareness is growing about how annuity options can be tailored to suit individual circumstances in retirement,” he said.
Black said value protection could provide reassurance to retirees concerned about dying shortly after purchasing an annuity, although value protection lump sums are due to be included in inheritance tax calculations from April 2027.
“It is particularly encouraging to see the rise in open-market annuities, indicating that more customers are shopping around,” he added.
“This helps secure not only a competitive rate, but also an annuity product that is structured around someone’s specific needs.”
The analysis comes as annuity rates have reached decade highs, according to Canada Life, increasing their appeal to retirees seeking a predictable income for life that is not exposed to investment market fluctuations.
