There has been a noticeable shift in the profile of annuity demand, according to Standard Life, which found more customers aged over 75 on top of a growing number purchasing higher-value policies as retirement planning adapts to upcoming tax changes.

The proportion of annuity quotes for customers aged over 75 has more than quadrupled since 2024, rising from 1.3% to 5.5% year-to-date in 2026.

At the same time, the share of quotes worth more than £1m has more than doubled, while the average annuity premium has increased 14% year-on-year from around £91,000 in 2025 to more than £100,000 in 2026.

Standard Life said demand is being driven by a combination of historically strong annuity rates, the certainty of guaranteed retirement income and changes to inheritance planning ahead of pensions being brought within the scope of inheritance tax (IHT) from April 2027.

The provider said the policy change is prompting wealthier individuals and their advisers to rethink long-standing strategies of preserving pension assets for inheritance purposes. Government estimates suggest around 10,500 estates will become liable for IHT due to the change, while a further 38,500 estates could face higher tax bills.

Annuities are increasingly being considered as one way to reduce the value of an estate while continuing to provide income or enabling gifting strategies. Standard Life research found 39% of financial advisers expect annuities to become more popular as a result of the reforms.

Pete Cowell, head of annuities at Standard Life, said: "We’re seeing growing demand from older customers as well as an uplift in larger annuity cases, reflecting how retirement needs and planning behaviours are evolving. While multi-million-pound annuities are still a minority purchase, the market is experiencing strong demand due to the combination of income certainty and attractive rates."

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