"Lack of awareness" affecting PTAs

www.moneynews.co.uk > Pensions > "Lack of awareness" affecting PTAs

"Lack of awareness" affecting PTAs

Mon 27th Nov 2006

The amount of people taking advantage of the government's Pension Term Assurance (PTA) is less than one in ten, highlighting a failure on behalf of many to gain "free money", according to price comparison website Moneysupermarket.

Though PTA can provide people with up to 22 per cent tax relief, Emma Walker, protection manager at Moneysupermarket, said that through a possible "lack of awareness", individuals were not making the most of the scheme.

Just over one in five people said that they would consider utilising PTA, research from Moneysupermarket discovered, while 41 per cent stated that they did not understand what PTA is.

Ms Walker said: "We believe that if providers and advisers explained this new product more clearly to customers, far more would consider switching to PTA to save money on their life insurance.

"It's important to point out that the product features of PTA won't suit everyone by any means, but for millions of taxpayers it could add up to hundreds of pounds of free money from the government in terms of tax relief over the term of their policy."

The Financial Services Authority explains that it is not necessary to have a pension to have PTA and the money accrued is paid out when the individual dies, rather than provide retirement income.

Related News : Pensions
	Over-55s don't believe in paying for care, reveals Aviva
	East Midlands comes top in pension contributions
	Corporate pensions provider issues advice for businesses
	One third of workers have no pension, claims Prudential
	More than a third of Brits fail to reassess pension risk, claim experts
	Women protest at No 10 over proposed pension reforms
	Retirement age 'to be brought forward by ten years'
	Interest rates held at 0.5 per cent by Bank of England
	Pension contributions fall in recession, ONS reveals
	Equity release for retirement 'might not suite every household'