In a response to the Treasury consultation on home reversion schemes SHIP argued that by only regulating equity release products the government would be creating a two-tier system where brokers and consumers might chose products purely for regulatory reasons.
John King, chairman of SHIP, said: “We welcome HM Treasury’s decision to engage in a formal consultation process regarding the regulation of home reversion plans. We see this as a necessary step towards the eventual introduction of formal regulation. Regardless of the government’s actions, SHIP intends to maintain its position as the industry standard bearer that consumers can trust, and will be announcing a tough code of practice for reversion schemes shortly.”
The call for regulation from SHIP coincided with the release of a survey from The Prudential which found the number of people over 55 who would consider equity release, if the market was regulated, has doubled in the past year. The survey also found 59 per cent of IFAs said they were more likely to sell equity release once it was regulated, with a quarter seeing it as the biggest area of growth for their business during the next five years.
