So, life companies have chosen to criticise the very idea of a 50-year mortgage. Well, fancy that.
“They say savings on 50-year loans would be minimal as protection policies would be very expensive if available at all for such terms,” quotes last week's MM.
Isn't Norwich Union the same life company which promotes an equity-release plan to those with insufficient income for their retirement? Bear with me, I will get to the point in a second. Those of us who recognise the demo-graphic timebomb as an inevitable catastrophe will know that, for as long as it takes Mr Average to save for his eventual financial independence, he will need suitable insurance to cover the wealth gap.
Now take the average amount per head saved towards retirement and tell me how long it will take Mr Average to reach the goal he so richly deserves. Surely, the term of cover will need to extend until then. Frightening when you face up to the truth, isn't it?
I am quite sure other life companies have voiced similar reservations, so we need not single out NU for their apparent ignorance or is it hypocrisy, cynicism, or blatant self-interest at the expense of real consumer needs? You tell me. There is a part of me that does not blame life companies for looking after themselves.
After all, with the average amount of life cover per head of working population at ridiculous levels to go with the above pension black hole, the Government plunders the provision we are making through tax credits and insurance premium tax. Then it forces people to pay a fee if they want to get truly independent financial advice.
Then, once the fee is paid, you are best advised not to sign up for stakeholder as you will lose out on “projected” state benefits (even if it is only 50p in the £1).