Plans for the second-hand annuity market unveiled today lack crucial details just a year before the reforms are due to launch.
The FCA and the Treasury both published documents outlining how they expect a second-hand annuity market to function from April 2017.
However, questions over the advice requirement, how providers will keep track of customer deaths and how medical questionnaires will work remain unanswered.
The regulator and the Treasury have provided no further details on what kind of advice customers will have to take when selling their annuity, nor where the threshold will be set.
Annuity providers also say the regulator has made a mistake in not creating authorised bureau.
Just Retirement group communications director Stephen Lowe says: “The FCA have been reasonably robust in terms of what they have put in place, but they have fallen short.
“The one way to create an open and transparent market is to have a series of authorised bureaux. They have fallen short by not doing that but they have tried to do their best.
“They have made steps to explain the way this market will operate, and done things that they don’t even do for the retail market, but there is still no single place where people can go to get surety of an open and transparent market.”
Aegon regulatory strategy director Steven Cameron says: “I still see no easy way for a provider allowing an annuity to be assigned to find out when their original annuitant dies.
He adds this also means that sellers could be required to deal with multiple teams of underwriters, and multiple medical examinations.
The plans reveal that annuity buyers will be expected to provide selling customers with details of how much it would cost in today’s market to buy an annuity of equivalent value.
However, there is little information about how this process will function.
Retirement Advantage pensions technical director Andy Tully says: “The key here is that we need to see greater detail.
“What does open market mean in that context? Can a provider simply provide their own quote?”