You are here: Home - News -

EU’s Solvency II threatens equity release, provider warns

by:
  • 10/06/2013
  • 0
European policymakers must recognise the benefits of equity release in order to support the continent’s aging population, Just Retirement has urged.

The equity release provider has called for the European Union’s insurance legislation Solvency II to include equity release loans as a ‘permitted asset’.

Just Retirement external affairs and customer insight director Stephen Lowe (pictured) said: “Europe faces rapid growth in the number of retirees and many will not be able to fund and adequate retirement from pensions and savings alone. Equity release can help but the market needs to be allowed to develop in terms of competition and innovation.

“Policymakers in the UK are starting to take equity release more seriously as a solution to pensioner income shortfalls, but the new report shows many European countries such as Germany, France and Sweden could benefit even more from a flourishing market.”

Solvency II, which focuses on insurance regulation and comes into effect in 2014, does not recognise the ability of equity release assets to match long-term insurance liabilities.

As a result, Towers Watson has warned the product could be less attractive to the insurers best placed to offer it and consequently stifle the market.

There are 0 Comment(s)

You may also be interested in