UK - Friends Provident has become the latest insurer to cut with-profits payouts, warning that figures could drop further still.
Payouts to policyholders have fallen around 18% this year, compared to 2000.
Friends warned that despite the much anticipated economic recovery, long-term investment results are excepted to remain much lower than in previous decades.
“The negative investment returns experienced in 2000 and 2001 have still not been fully reflected in payout levels,” said the firm.
“As a result unless there is a significant growth in equity and property values in the remainder of 2002 further reductions in payout levels are likely.”
By Madhu Kalia
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers