Home reversion plans are to be regulated by the FSA following consultation by the Treasury.
Financial secretary Ruth Kelly says: “Buying a home reversion policy is a huge financial decision involving the most important, and sometimes only significant, asset of elderly people. It can have significant implications for tax, benefits, inheritance and long-term financial planning. Regulation will help people to make informed choices, offer valuable consumer protection and ensure that there is a level playing field in the equity release market.
“Legislation to regulate home reversion plans will be brought forward as soon as parliamentary time allows.”
The Treasury is now planning to consult on the definition of home reversion plans for the forthcoming legislation.