“Clearly, providers need to be in touch with adviser users and will respond with offerings that meet client needs, but essentially everything someone requires to build a retirement income that works for them already exists. The role of providers is to drive cost down and offer choice and service that works for advised and direct customers."
He continues: “People often ask for innovation without specifically saying what they want people to offer. And I think there is some value that rather than chasing something whizzy that perhaps people don’t want, advisers focus on what people want.
"The one thing you are in control of in drawdown is the cost of the stuff you do and if providers can focus on getting the process as slick as possible and reducing cost, that has to be a good outcome.”
Keeping it simple
Mr Lowe believes the providers that will gain market share by being innovative are those who can take the complexity out of their products to make them simpler to understand.
Martin Tilley, technical director at Dentons Pensions Management, adds: “The problem with guaranteed products is the way they have been structured in the past has been opaque and difficult to understand, almost as much of a turn off as the investment risk itself.
"I don’t think anyone has brought that to a head yet and come out with an innovative product, because if they were able to do so and it was simple then it would be a winner.”
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