People selling their annuities should not be forced to take advice, Citizens Advice says.
The organisation – which is delivering the face-to-face Pension Wise appointments – also says the Government-backed guidance service should have its remit extended to include discussions about the secondary annuities market.
This week, Money Marketing revealed how providers are torn between offering customers access to the new pension freedoms, and protecting them through insisting on advice.
In its response to the Treasury’s consultation on creating a secondary annuities market, Citizens Advice says: “Pension Wise can inform consumers about the key risk free of charge.
“We propose that those with annuities worth more than £30,000 (or a monthly equivalent) should have a firm requirement to take either advice or guidance.”
The Government originally said people on means-tested benefits should be barred from selling their annuity.
But Citizens Advice says: “We don’t believe it is right to exclude more than 700,000 annuity holders from freedoms available to all other over 55s. In fact, these people may benefit most from the proposed freedoms.”
It also suggests the Government reach an agreement with annuity providers to ensure they “all consent to assignment” and that “the cost of doing so will either be accepted as a cost of doing business or will be reflected in a modest standard or capped charge”.