A LOCAL finance industry provider believes it may have a solution to the island’s threatening annuity crisis. There is concern that the island is exposed, with just one provider available to local residents.

But Dave Merrien, managing director of Goldridge Stone, which recently merged with de Beauvoir, believes that greater use of retirement annuity trust schemes may be the answer.

Mr Merrien said that pensioners would be able to draw an income from the fund in their trust without taking out an annuity and potentially get a better deal from their retirement ‘pot’.

He is starting to offer a Rats as part of the Goldridge retirement annuity trust for company pension schemes.

‘I’m inundated and not pushing it yet,’ he said.

Norwich Union was left as the island’s only annuity provider when Eagle Star pulled out late last year.

But a new one has announced that it plans to enter the market next month.

The Pension Annuity Friendly Society is planning to expand into Guernsey in September, offering pension, long-term care and life insurance products.

The company, in business since 1995, provides fast-turnaround financial services for all clients and particularly people with medical problems.

It pioneered impaired life pension annuities.

‘The feedback we have received from IFAs shows there is a real concern that residents will reach retirement and require additional income. Yet there has been a surprising lack of support from financial providers for annuity business in Guernsey,’ said Eyeedul Haque, business development manager at Pafs.

‘We are perfectly positioned to amend that oversight. It’s a win-win situation for everybody.’

Local specialists have welcomed the Pafs announcement.

‘We have recognised for some time the problems that could arise with just a single provider in the pension annuity market in Guernsey,’ said Ian Morris, a director at BWCI. The company contacted Pafs to make it aware of the local situation.

Alexander Forbes director Sean Martin said: ‘Thank goodness we have finally managed to encourage a ﾓnewﾔ annuity provider to come to the island.’

* Pafs will launch in Guernsey with a seminar to local IFAs at the Old Government House Hotel on Thursday 2 September.