Bank of Ireland Life Highlights Reasons for Low Pension Coverage Levels Including Unnecessarily Complex PRSA Requirements.

Recent research carried out by Bank of Ireland Life released today (28th June 2004), together with internal customer insights, reveals alarmingly low pension coverage levels among Irish consumers. Misconceptions around pension products and complex requirements in selling PRSAs are key contributors to this problem. Bank of Ireland Life suggests that less cumbersome requirements around the PRSA sales process and greater awareness of the need to plan for retirement would be major steps in the right direction.

Highlights from the nationally representative research show:

The research figures clearly highlight the ongoing problem with the level of pension coverage and awareness in Ireland. This coincides with the Pensions Board's research which found that, of those working in the catering and tourism industries, only 12.5% have pension coverage. In addition, only 15% of seasonal and part - time workers have pension coverage. Furthermore, only 15.8% of those working in agriculture have pension coverage.

For those of us that have some form of pension provision, is it enough? According to recent research commissioned by the Irish Insurance Federation, the gap between what we should be saving for retirement versus what we are saving represents an annual average deficit of €3,300 per worker. Ironically it is the middle - income worker earning €32,500 - €52,500 who has the largest savings shortfall of all, at almost €5,000 per year.

Despite reforms in the pensions industry and publicity campaigns surrounding the introduction of PRSAs, we have yet to see any real impact in terms of pensions awareness and coverage in Ireland. Bank of Ireland Life's research reveals that a highly significant 44% of respondents didn't really understand what a PRSA is, one year after its introduction.

Commenting on the research findings, David Swanton Marketing Director, Bank of Ireland Life said: "The research shows that there are some worrying trends in terms of attitudes to pension provision and a clear knowledge gap around PRSAs. The problem is most acute for those in the lower and middle income levels and this is the very group who have most need to make advanced pension provision. Clearly, our approach to saving and planning for the future will need to be addressed if current standards of living are to be maintained in retirement."

Starting your pension as early as possible is the key to addressing this issue. The average age of a PRSA policy holder with Bank of Ireland Life is 36 years - a late starter considering most people join the workforce at least ten years prior to that. That means ten years without pension contributions, and more importantly, ten years of investment growth wasted.

Concluding, David Swanton said:

The research was conducted by Lansdowne Market Research across a nationally representative sample of people aged 15+. Sixty random sampling points were chosen nationwide.

About Bank Of Ireland Life:

Bank of Ireland Life is an independent company within the Bank of Ireland Group. We provide Life, Pensions, Savings and Investment products, which are distributed in over 280 Bank of Ireland Branches throughout the country.

Bank of Ireland Life offers customers the accessibility and availability of professional financial advice through their local Bank of Ireland branch. In every Bank of Ireland branch, there is an Insurance & Investments Manager, who is trained to help identify our customer's financial needs and assist them with any queries they may have. Our Insurance & Investments Managers are committed to providing quality advice and specialist expertise to help our customers find the best solution to their needs.

Date: 28th June 2004

For Reference:

Jenni Smith
Life & Pensions Product Manager
Bank of Ireland Life
Tel: 01 617 2575

Anne Mathews
Media Relations Manager
Group Corporate Communications
Bank of Ireland
Tel: 01 604 3836