View more on these topics

Treasury says home reversion to be regulated

The Treasury announced this week that home reversion schemes are to be regulated by the FSA alongside lifetime mortgages but has already run into criticism over the length of time before the new regime come into effect.

Financial secretary Ruth Kelly says regulation of the sector will help people make informed choices. It will also offer consumer protection, which is important because buying a home reversion pol-icy can have implications for tax, benefits, inheritance and long-term financial planning.

The Treasury will shortly consult on the scope of regulation, which will be followed by an FSA consultation on the details of the regulatory regime. The change will require primary legislation, which will be introduced when the Parliamentary timetable permits. It is speculated that regulation will come into force in 18 months to two years.

Safe Home Income Plans chairman Jon King says there is likely to be a long delay before regulation is introduced.

CML head of external affairs Sue Anderson says the timetable means home reversion regulation is unlikely to dovetail with the onset of mortgage regulation in October.

Of the 53 consultation responses the Treasury received, 46 supported regulation. Providers, trade and consumer bodies welcomed it. The only dissenters were small brokers, who were concerned that the costs of regulation would outweigh any benefits.

Kelly says: “Legislation to regulate home reversion plans will be brought forward as soon as parliamentary time allows.”

King says: “We will still go ahead with our plans for an interim regulatory regime to bolster confidence as it is implicit in this decision from the Treasury that there will be a long delay.”

Norwich Union Personal Finance director Mark Kelly says: “The interim measures will be fully supported by Norwich Union but we urge the Treasury to fast track this process.”

Recommended

&#39Changing family lives will increase demand for care&#39

Demand for long-term care will rocket by around 60 per cent by 2050, leading to a significantly bigger market for LTC insurance, a major research project has predicted. The research, conducted by the Cass Business School, in the City of London, and a Swedish economist has found that changes in demographics and the traditional family […]

That will be the A-day

Taxbriefs should have to write out: “Pension simplification comes in from April 2006” 100 times, says the Diary after seeing its Spring Financial Review that was being handed out at last week&#39s Money Marketing Live. The Diary knows it can be expensive to get a reprint but, with a lead article putting A-day a year […]

NDF Administration – European Defined Bonus Plan

Type: Capital-protected bond Aim: Growth linked t the performance of the Dow Jones Eurostoxx 50 index Minimum-maximum investment:£10,000-no maximum, Isa £7,000 Term: Six years Return: 10% of original investment at end of year one if the index is at or above its initial level, 20% at end of year two if the index is at […]

Home reversion plans to be regulated

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. […]

Certification guide

Guide: how to… certify your pension scheme

Certification is highly complex and surrounded by a minefield of information and auto-enrolment jargon, which can make it very difficult to understand. However, for many employers it is a necessary process that must be executed successfully.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com