Douglas Anderson, Partner and Founder of Club Vita and Life & Financial Services said

“This is good news for consumers. While some retirees may feel a sense of disappointment as they feel trapped in a product they didn’t want to buy, in reality, getting value for money from cashing in annuities would have been a tall order. With freedom to sell came the risk of making poor decisions. There simply would not have been enough protection in place for consumers come April.

“While it’s good news for consumers, in the short-term it may not be such great news for insurance industry which could not afford to assume a U-turn was a possibility. Many were busy designing new processes to cater for annuitants considering selling their annuity. Others have been taking greater steps to prepare. For example, some manufacturers and distributors of enhanced annuities were hoping to repurpose their health based underwriting models to assist with pricing. Others were hoping to buy second hand annuities to hold as an asset against new annuities being sold.

“On balance though this news should be welcomed. Creating an open, secondary market for selling on annuities would have been no small undertaking and the risk to consumers, and by default insurers, would have been high.”