A Pension Term Assurance (PTA) factsheet has been launched by the Association of Mortgage Intermediaries (Ami).
PTA is a term assurance product written under pensions legislation, which currently allows relief on the premiums.
The pension simplification changes mean mortgage intermediaries who hold general insurance mediation permissions are now able to provide access to PTA under the Insurance Code of Business (Icob) rules.
The changes allow PTA to be sold on a standalone basis without the requirement for the client to also be contributing to a pension arrangement.
The factsheet provides information on the Icob rule requirements for PTA and outlines other areas of the Financial Services Authority (FSA) handbook which will need to be considered before deciding whether or not to offer PTA.
Rob Griffiths, associate director of Ami, states: “It is estimated that 54.5% of all term assurance sales are made with a mortgage, and the pension simplification changes mean that mortgage intermediaries who hold general insurance mediation permissions will be able to provide access to PTA.”
Although PTA can provide members with business opportunities, Griffiths warns there are risks associated with the sale of these products and he advises members to put systems and controls in place to address and manage the risks.
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Emily Perryman on 020 7968 4554 or email [email protected].
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