Steve Webb's plan to extend pension freedoms to all retirees, creating a market for annuity resales, is well-meaning but unlikely to work in practice, Fidelity retirement director Alan Higham has said.
He said while Webb's plans were "undoubtedly noble" it would be hard to create an orderly market to facilitate the sale of annuity contracts. Higham (pictured) explained: "An annuity must stop payment or payments alter when original owner dies. How will the new owner and the original insurer know this has happened? How would an executor know an annuity sold fifteen years ago had even been owned much less have any prompt to tell the former insurer of the demise of its former owner? "You would have to agree to regular certification of being alive in order to sell the annuity. If you mov...
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