Life companies have confirmed they have tens of thousands of pension term assurance policies in the pipeline, which could be hit by the Government’s expected withdrawal of tax relief.
Scottish Widows protection marketing manager Nick Kirwan estimates the number of PTA cases in the pipeline to be in the tens of thousands and is warning advisers to put the policies on risk to ensure customers are not left without cover.
An unnamed source at another life office estimates the number to be 37,000.
Norwich Union announced it would be extending free life cover to all its pipeline customers until further notice.
Royal Liver IFA market manager Andy Milburn says the most important thing is for providers to continue with the und- erwriting process on pipeline business to make sure custo- mers are on risk and protected.
Milburn says: “Providers and advisers cannot just leave these consumers unprotected. They will have to be rebroked onto ordinary term life policies.”
Hargreaves Lansdown head of protection research Jonathan Briggs says: “Having spoken to several life companies, a more disturbing likelihood is that there are a further 40,000 to 50,000 policies that are still in the pipeline and not yet completed.
“These people will not get tax relief beyond next April and are likely to be sorely disappointed.”