The Equity Release Council has unveiled updates to its consumer protection standards, following an extensive review and consultations with stakeholders.
These updates, mandatory for all member entities, aim to bolster customer safeguards, ensuring comprehensive information dissemination and adherence to best practices in products and services.
Set to be implemented from March 1st, 2024, the initial phase of updates introduces significant enhancements to product flexibility and choice for consumers in their later years. Notably, the council has introduced new standards for Mandatory Payment Lifetime Mortgages, providing customers with improved protections and increased reassurance.
What’s more, the updated standards now mandate that financial advisers include income and expense analysis within the advisory process. Although this practice is prevalent among many advisers, the formal inclusion in the council’s standards ensures its uniform application, enhancing the thoroughness and quality of advice provided to consumers considering equity release options.
This move is part of a broader initiative to refresh the council’s consumer safeguard standards later in 2024, reflecting its commitment to evolving customer needs and industry best practices. Michelle Highman, chair of the Equity Release Councils Standards Committee, said:
“The Council’s Standards have been vital to the development of a vibrant market, but it is important that we regularly review them and consider how we best serve customers as well as support innovation within this sector.
The Council is therefore undertaking a thorough review in 2024 with input from members, stakeholders, and other interested parties.
The evolution of our Standards is key to helping the market continue to grow and ensure that the diverse customers who choose to access their housing equity can do so with confidence.”
Kelly Melville-Kelly, director of risk, policy and compliance at the Equity Release Council, added:
“As a market, we have seen significant innovation and change over the last few years, and it is vitally important that we ensure our Standards continue to evolve.
The updates that we have announced today are just a start and we will shortly be launching a wider review and seeking input from members as well as wider industry stakeholders.
This will be a wide-ranging refresh which will look at not only the standards themselves but how they are communicated to customers to ensure that they provide the best protection possible.”
Craig Brown, CEO, Legal & General Home Finance said that the council’s announcement gives consumers the “peace-of-mind” that comes with its endorsement when considering new products, but also “sends a signal to the industry that product innovations such as this, rooted in customer need, are important for the sector’s continued evolution”.
