Thousands let down by annuity rethink, says Altmann
Source - SMW
The Government's decision not to proceed with its proposals to allow people to sell back their annuity income will come as a major disappointment to thousands of people, former pensions minister Ros Altmann says.
She adds: "Many have been waiting anxiously for the opportunity to undo the annuity they were forced to buy and will feel let down by today's announcement that the secondary annuity market is being scrapped.
"Many will be stuck for the rest of their life with an annuity they never wanted: This was never likely to be a huge market, but for some individuals it would have been a potential lifesaver.
"Those who bought an annuity because they were forced to do so, but would not have purchased one unless the law required it, have been waiting desperately for an opportunity to sell it but that opportunity is now being taken away from them."
Altmann points out that while the Treasury says that only 5% of annuity holders would want sell back their annuities, this is still a huge number of people.
She said that around 600,000 annuities were being sold each year and most of these products offered no protection against inflation and did not ensure a spouse would be covered.