UK - Insurers are urging the government to rethink its proposals on money-back annuities which caps the option at age 75.
The Association of British Insurers believes the move will only lead to more confusion in the market.
Money-back annuities are currently available for set five or 10-year periods.
But an ABI spokesman said that while insurers welcomed any move to expand provision, the age 75 cap meant it was of “limited value and would not properly be understood by consumers”.
He said: “To give consumers maximum value-for-money from their annuity, money-back guarantees should be permitted after age 75.”
Annuity Bureau managing director Peter Quinton agreed and claimed the change would not meet the government’s objectives of making advice easier and simpler.
But he said the development of new annuity products was good as it would lead to more consumer choice.
The Conservatives expressed disappointment that the compulsion to buy an annuity at age 75 had not been scrapped.
Work and pensions spokesman Lord Higgins said this was particularly important now as annuity rates were set to rise following the Chancellor’s announcement that government borrowing would rise.
He said this meant that people who were forced to buy an annuity now would lose out.
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