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DEXX&R predicts strong super growth
The total superannuation market sector will grow at 9.3 per cent per annum to $2.9 billion over the next 10 years, according to a Market Projections Report from DEXX&R.
The total financial services market is predicted to grow at 8.9 per cent to $3.2 billion over the same period, while retirement incomes should grow at 11.3 per cent to $305 billion and in-force business in the risk market is projected to grow at 13.4 per cent from $8.6 billion to $30.1 billion.
Funds under management and administration (FUMA) in the self-managed super fund and industry fund segment has recovered to pre-GFC levels, employer sponsored super is at 94 per cent of 2007 levels and personal super is still at just 80 per cent of June 2007 levels, the report found.
The shifts in FUMA indicate personal super will be a smaller part of the super market in the future, having fallen from 33 per cent to 23 per cent in the past three years (it is expected to stay at around 24 per cent).
Growth in total retirement incomes will be driven by a greater number of people reaching retirement age and a wider range of conservative income-focused investment options becoming available.
Recent growth in group risk has been driven by improvements in default cover but may slow as super funds negotiate improved cover with small increases in premiums, the report stated.
AUTHOR
Mike Taylor
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