Treasury economic secretary Ed Balls said today that he would be writing to FSA chairman Callum McCarthy recommending that the age 70 rule be scrapped.
The FSA is to consider the decision on whether it will scrap the age 70 rule on protection policies this Thursday at a board meeting and will announce the decision following the meeting.
Balls said at the FSA’s Principles-based Regulation conference today: “I am writing to Callum McCarthy to recommend that the age and term conditions for life insurance policies be scrapped.”
If the rule is scrapped, Icob advisers will be allowed to sell policies maturing beyond age 70 as these can only be sold by Cob advisers at present.
Providers say it will open up the marketplace for conventional non-profit whole-of-life plans and pure protection whole-of-life plans to Icob advisers.
The FSA originally suggested two options – scrapping the rule or raising the age 70 condition to 80 but is expected to take the former option.
Association of British Insurers protection committee chairman Nick Kirwan says: “Scrapping the rule is something I have been campaigning for for a long time as it will help to open up the market.”