The pensions industry must change its “apologetic tone” and be “proud” of the innovation it has achieved over the past six years, Aviva has said.

Speaking at the Association of British Insurers’ (ABI) conference yesterday, 26 April 2018, Aviva head of savings and retirement Alistair McQueen hit back at the Financial Conduct Authority’s assertion that there is a lack of innovation in the retirement market, hailing auto-enrolment and pension freedoms as two big examples.

Last year the FCA released its Retirement Outcomes Review Interim Report, in which it argued product innovation had been limited to date, particularly around the mass market of consumers who do not take advice.

McQueen said: “I have a clear conscious when it comes to my company and our industry on the subject of innovation, I believe there is a slightly apologetic tone in the industry about our limited innovation. If the FCA are in the room I would challenge you about our limited innovation.

“There are three things that make up innovation, one, an idea, secondly, the idea needs to be translated into a goods or a service and thirdly that good or service needs to be of value … the two big examples I would bring to the room are automatic enrolment and the pension freedoms.”

McQueen argued that bringing nine million people into auto-enrolment in the past six years, as well as three million accessing their pension freedoms constitutes as innovation.

“Before we talk about where the next innovation is going to come from, I think as an industry we need to change our mindset … I would challenge another industry to show more innovation”, he added.

Despite this, McQueen said that the industry is ripe for disruption and that Aviva is trying to challenge itself before somebody else comes in and challenges the industry.

When asked where the industry will see the most innovation in the coming years, 38 per cent of the audience believed it will come in engagement, compared to 29 per cent through investment strategies and 18 per cent for advice.

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