Since being brought under Icob rules, pension term assurance has provoked strong reactions , with concerns over poten- tial misselling.Skandia protection marketing manager Alison Turner-Holmes thinks the FSA was wrong to bring PTA under Icob and she describes the potential for misselling as “huge”. She explains: “There is no way that an Icob adviser will have the knowledge to recommend something properly. They have got to have an in-depth knowledge of pensions and need to look at a client’s whole portfolio.” Skandia contemplated launching a PTA product but decided it had little market potential. Turner-Holmes thinks PTA will not be much cheaper than other life products and does not think that high-net-worth individuals who it is likely to appeal to can be bothered to claim back the tax relief. Aegon has confirmed that it will be providing a PTA product although it may not be ready for an A-Day launch. Bright Grey is looking at developing a product and wants to be in the market, according to group products director Roger Edwards. Royal Liver IFA market manager Andy Milburn says the company will be launching a product, hopefully in time for A-Day. Further details of the product are likely to be available in early March, he says, and tele-underwriting will be one aspect of the product. Milburn cannot understand why providers are not being more open about whether they will be launching into the sector. He says: “We are running out of time so I do not understand why other providers are not talking about it. “We think that one or two providers will be launching in April and another two or three a few months later. It will probably be all the big ones that you would expect to enter the market.” Lifesearch senior technical adviser Kevin Carr says it is impossible to predict what the market will look like because there is still so much up in the air. He believes that the final rules from the FSA will be released in February. He says: “The poor IFAs have been left in the lurch once again and cannot really prepare for PTA. We have 150,000-plus clients and a lot are high-net-worth individuals. We are not sure whether we should contact them or not.” Carr thinks that if a provider comes up with a simple switchover product, they could take a big slice of the PTA market but suspects that the market will take a couple of months to settle down. “Providers could do really well out of PTA products but then again they could just get stung,” he says. Highclere Financial Services partner Alan Lakey says although it makes sense to bring PTA under Icob, he is concerned on how the FSA will police the system. He thinks there is a danger of the wrong products being recommended to the wrong people, although he would not use the term misselling. In terms of PTA as a long-term viable product, some advisers and providers have concerns that the Treasury could do a U-turn and withdraw tax relief on the product in the future. Lakey says the industry cannot work on this assumption as it is impossible to predict if this will happen. But Direct Life & Pensions sales and marketing director Richard Verdin says: “The Revenue and the Chancellor have demonstrated a propensity to change their minds so it would not surprise me if they do a U-turn and withdraw tax relief.” Bright Grey’s Edwards says PTA may as well be a new market as the only provider offering it at present is Liverpool Victoria. He thinks that one of the pitfalls is that consumers could get side-tracked into a debate over tax relief which could restrict the potential for sales in other areas of protection, such as critical-illness cover. He says: “We have got to make sure that the tax relief carrot does not deflect people from being advised on the holistic solution. Icob advisers should be allowed to sell PTA but the industry has a duty to make sure that they are given all the necessary support and documentation.” There is still much debate over the name, pension term assurance, and the potential confusion it could cause for consumers. Edwards says that although the name is not ideal, there will be a problem with changing it unless the whole industry can agree upon one generic name. Verdin says the product must be adequately explained to the customer. “We do not want a customer walking away thinking it is a pension. This will depend on the promotion and naming of the product and the skills of those offering it.” Verdin believes PTA is “a storm in a teacup” and thinks the protection market will be largely unaffected. “There are a number of brokers out there who will make more money out of it. A couple of providers will win more consumers because they were there first but it is not that important to the customers that are out there,” he says.