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Insurers: Government should slow down on pension reforms


Insurers have urged the government not to rush through plans to allow pensioners to sell their annuities for cash.

The extension of the pension overhaul in April 2016 could put older people more at risk of scams, according to The Association of British Insurers (ABI). The latest changes would allow five million pensioners who have already bought an annuity with their pension pot to sell it back.

The ABI has claimed that the plans to allow pensioners to sell back their annuity to providers is not clearly defined and more information needs to be given on whether annuities could be sold back to the provider, but without an obligation on that provider to agree to the deal.

ABI also believe lessons should be learned from recent pension changes that allowed people to cash in a pension pot.

Yvonne Braun, of the ABI, said:
"Naturally there are considerable challenges in establishing a functioning market, and many unresolved complex legal, regulatory and prudential questions.

We want to work with government to help resolve these issues, but given the lessons learned from the [recent] reforms and the need for clarity in many areas, we urge the government not to rush these proposals through for 2016.

"Allowing more time will ensure an appropriate regulatory regime can be developed to give this new market a chance to succeed."

A spokesperson for the Treasury said:
"We are removing restrictions on selling annuity income so that the five million people who have already bought them have the same freedom as everyone else."

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