Providers face up to 30% hit due to 1% charge cap

Providers offering Sandler-style products could face losses of up to 30% of the annual contributions paid into them due to the proposed 1% charge cap, according to actuarial and management consultant Tillinghast-Towers Perrin. The group said the charging structure makes inadequate allowance for the cost of providing advice and assistance, which many in the target market will need. Therefore, few companies will offer them to the low-middle income consumers for whom they were intended. Tillinghurst added a charge cap of 5% would be more effective in encouraging providers to develop and promot...