Ali Crossley, Director of Lifetime Mortgages at Prudential comments: "It's a surprising move by Norwich Union as the home reversion market is in decline.
"People are reluctant to sign away their home at such a discounted rate - and many feel uncomfortable seeing insurance companies benefit from rising house prices. While NU's product goes some way to address these concerns, it only draws attention to the fundamental shortfalls inherent in home reversion schemes. Added to the fact that they are only suitable for older customers, the home reversion market is definitely not one that the Pru expects to grow.
"What the lifetime mortgage market really needs is something that offers flexibility and puts the customer in control. Any provider who can offer that is onto a winner."