Property Income Plan and Equity Release

Daledog

Doc_N wrote: »

Two main questions (quite apart from any risk to the homeowner):

1 How does taking a charge on a third party's property add to the assets of an insurance company in any way under normal international accounting standards? Or under commonsense principles, for that matter?

2 If insurance companies are trying to get round their obligations in this way, shouldn't a sensible government be trying to stopm them before there's a domino-like collapse (all over again)?

Don't these financial tricksters ever learn?

Yes I agree it all sounds like an insurance company is making out it has assets more than it really has.

GPow45

Ian_W wrote: »

Now remind me, who was it said "don't invest in things you don't understand"?

Sounds more like a scam than a scheme, for that reason, I'm out!

"Scam" is a strong word and an accusation which you are, obviously not qualified to make, though I do respect you have an opinion. However, opinions should be tempered by knowledge and you freely admit you have none on this product.
There are some excellent explanations in this forum which should be read and digested fully by all the visitors.
You will lose out if you do not open your mind but, tragically, you may be responsable for others losing out.
This plan is a godsend in the current climate where a lot of us could do with some extra money.
Any one who searches here has probably Googled "Property Income Plan" because they have been approached by an IFA/Introducer. They should, therefore, get back to that person and find out for themselves. IFA's are not like the old "Tied Agents" and are not out to take anybody for a ride. Commissions and fees are always a cause for concern but if someone gets you a load of money with no strings and no risks, why should they not be paid handsomely for it?

Doc_N

GPow45 wrote: »

"Scam" is a strong word and an accusation which you are, obviously not qualified to make, though I do respect you have an opinion. However, opinions should be tempered by knowledge and you freely admit you have none on this product.
There are some excellent explanations in this forum which should be read and digested fully by all the visitors.
You will lose out if you do not open your mind but, tragically, you may be responsable for others losing out.
This plan is a godsend in the current climate where a lot of us could do with some extra money.
Any one who searches here has probably Googled "Property Income Plan" because they have been approached by an IFA/Introducer. They should, therefore, get back to that person and find out for themselves. IFA's are not like the old "Tied Agents" and are not out to take anybody for a ride. Commissions and fees are always a cause for concern but if someone gets you a load of money with no strings and no risks, why should they not be paid handsomely for it?

It is surprising (or maybe it isn't), as somebody said, how many new posters there are in here.

Maybe 'smoke and mirrors' might sound more acceptable than 'scam', but however you look at it, this has all the hallmarks of something which is going to rebound horribly on somebody. I just hope it isn't the poor investors, but who knows.....?

I go back to this:

Unregulated equity release plan offered

The Financial Services Authority (FSA) has been made aware of the existence of an unregulated financial product.
Offered by Equity IQ, the Property Income Plan has been flagged up by the Society of Equity Release Advisers due to the fact that it is not authorised by the FSA.
The firm gets around this by claiming money from independent financial advisers in order to put them through a formal test which then 'licenses' them to sell the plan.
Simon Chalk, equity release planner at LaterLiving, commented: "Although the product may be perfectly legal and Equity IQ may argue that the plan isn't quite like a formal equity release arrangement, it will nonetheless be regarded by consumers as such so must only be considered in the same context of fully regulated products such as Home Reversion Plans and Lifetime Mortgages.
"Advisers considering selling this plan must also check that their PI insurers will cover them because it probably doesn't at present."


If that doesn't sound alarm bells for potential investors, perhaps it should? That, plus the fact that this cannot, under international accounting standards, do for insurance companies what it is claimed to do.

There would seem to be something very, very wrong with this product.

reflective

could i ask a quick question to the introducers? You talk of big names like [TEXT DELETED BY FORUM TEAM], Pru L&G etc. If i were to take out one of your PIPs could i specify that say [TEXT DELETED BY FORUM TEAM] took a charge on my property? Or is this pooled in some way? so i get exposure to a broad spread of insurers? or should i say, a broad spread of insurers take an interest in my property?

TIA

Penfold12

Doc_N wrote: »

It is surprising (or maybe it isn't), as somebody said, how many new posters there are in here.

I found the very first original post when I googled 'Property Income Plan'. I was looking for further information relating to the product.

What I found wasnt much, apart from the first 3 postings. All I have attempted to do, is to inform and clarify positions, and guage opinions.

I maybe new, but surely that doesnt devalue the content of my post does it?

This thread is the highest rated on google for property income plans and as such, may be attracting new posters, looking for answers.

Doc_N wrote: »

I go back to this:

Unregulated equity release plan offered

The Financial Services Authority (FSA) has been made aware of the existence of an unregulated financial product.
Offered by Equity IQ, the Property Income Plan has been flagged up by the Society of Equity Release Advisers due to the fact that it is not authorised by the FSA.
The firm gets around this by claiming money from independent financial advisers in order to put them through a formal test which then 'licenses' them to sell the plan.
Simon Chalk, equity release planner at LaterLiving, commented: "Although the product may be perfectly legal and Equity IQ may argue that the plan isn't quite like a formal equity release arrangement, it will nonetheless be regarded by consumers as such so must only be considered in the same context of fully regulated products such as Home Reversion Plans and Lifetime Mortgages.
"Advisers considering selling this plan must also check that their PI insurers will cover them because it probably doesn't at present."


If that doesn't sound alarm bells for potential investors, perhaps it should? That, plus the fact that this cannot, under international accounting standards, do for insurance companies what it is claimed to do.

There would seem to be something very, very wrong with this product.

Home Reversion plans, Equity release schemes, Lifetime mortgages, do not exactly cover themselves in glory, have they, and these are regulated products.....

If I sold Birdcages to pet stores, and a new competitor came to my market place offering self cleaning birdcages at half the price, I would also be pouring scorn over them.

The view by the Equity release planner, needs to be read with the above in mind.

Yes there are questions surrounding the content of the plan, but until contracts are issued, surely we should be reserving judgement until then?

Penfold12

reflective wrote: »

could i ask a quick question to the introducers? You talk of big names like Aviva, Pru L&G etc. If i were to take out one of your PIPs could i specify that say Aviva took a charge on my property? Or is this pooled in some way? so i get exposure to a broad spread of insurers? or should i say, a broad spread of insurers take an interest in my property?

TIA

I am sorry, but I dont now the answer to this.

I will try to find out and come back to you though.

Penfold12

Reflective,

The specific insure is not announced until contracts are completed, and cannot be specified. The assurance, or stipulation is that the insurer is AA rated or higher.

The property charges are packaged into tranches of say £10m, and then placed with a single insurer.

Does that help?

Doc_N

Penfold12 wrote: »

Reflective,

The specific insure is not announced until contracts are completed, and cannot be specified. The assurance, or stipulation is that the insurer is AA rated or higher.

The property charges are packaged into tranches of say £10m, and then placed with a single insurer.

Does that help?

Is there any assurance or stipulation as to the country/ies in which the insurers are incorporated? Are we talking UK/EU registered companies or maybe ones registered elsewhere?

Penfold12

Cannot definitively answer that one, yet, but one would assume that it would be EU/UK.

Doc_N

Penfold12 wrote: »

Cannot definitively answer that one, yet, but one would assume that it would be EU/UK.

I suspect it might not be, though, because of the accounting standards which apply throughout the EU. It may be that a loophole has been found which exploits a captive insurance company in a tax haven.

Just a guess.........