Friday 28th April 2006
Those looking to start or change their pension have been advised to take recent changes into account.
Since A Day on April 6th a number of changes have come into effect, including one less well-known rule which could see a number of people paying less for their life insurance.
Pension Term Assurance (PTA), which allows a life insurance policy to be written within a personal pension plan, will allow savers the same tax relief on their insurance premiums as on pensions contributions.
Despite the potential advantages, Kevin Carr, head of protection strategy for LifeSearch, warned that there are a number of risks and downsides that could make PTA unsuitable and unattractive.
He said: "[For people with existing policies], two words - take advice!
"The payment of a premium could trigger the loss of enhanced protection and the sum assured will form part of the lifetime limit."
He added that people need to be made aware of the issues surrounding PTA post A Day and that they should consider them thoroughly before they consider switching their pension.
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