The intermediary database provider reported that, excluding transfers, inflows equated to £4.3 billion, up £0.5 billion (12.7%) on Q4 2015.

The data, which the firm stated covers more than 90% of the UK’s leading life and pensions companies, shows investment in lifetime pension income (annuities) for the quarter dropped by £60.4 million (11.4%), while flexible drawdown investments increased to £972 million, up £11.6 million (1.2%) on the previous quarter.

Individual stakeholder pensions saw the largest inflows in the quarter, soaring 121.5% to £60.9 million. The quarter also saw new premiums (excluding transfers) driven into personal pensions and Sipps, increased to £3.8 billion, up £0.4 billion (12%) on Q4 2015 and up £0.85 billion (28.2%) year on year.

Geoff Greensmith, director at Equifax Touchstone, said: “Pension investments have seen significant growth in the first quarter of the year, particularly in individual stakeholder pensions, despite ongoing stock market volatility. This is likely to have been spurred on at the time by concerns over fears of significant changes to tax relief in the March 2016 Budget, although this did not come to fruition.

“Following pension freedoms in 2015, it is unsurprising that we continue to see investors favouring flexible drawdown products over lifetime pension income; a trend that is likely to continue for the foreseeable future.”