Independent financial advice website moneysupermarket.com has called for more UK adults to take up Pension Term Assurance (PTA) instead of standard life insurance policies.
PTA is a type of term assurance which uses the rules for pension schemes to provide life cover.
PTA allows tax relief on the premiums customers pay because it is a pension product – but customers can take out life assurance cover without paying pension contributions.
According to moneysupermarket.com, the survey unmasked consumer ignorance, with 12 per cent believing they needed a pension to take out PTA.
The research found that 31 per cent of people surveyed said they would not consider PTA policies while 41 per cent admitted they didn't know whether they should consider it.
Emma Walker, protection manager, said: "If providers and advisers explained this new product more clearly to customers, far more would consider switching to PTA."
"For millions of taxpayers it could add up to hundreds of pounds of free money from the government in terms of tax relief," she added.
Ms Walker called for improved consumer awareness of the options surrounding life insurance for the full benefits of PTA, which came into force seven months ago, to be realised.For more information on life insurance, click here.
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