Dying patients will be able to unlock private pensions early under new DWP 12-month terminal illness rule

Pensions minister Torsten Bell has set out plans to eliminate the bureaucratic obstacle preventing terminally ill people from accessing their own pension savings, replacing a strict one-year medical evidence requirement with a broader 12-month rule. The reforms will also address the anomaly whereby a dying person currently finds it easier to claim state benefits than to draw on their own private savings. Marie Curie has welcomed the move, pointing to its own research showing that a terminal diagnosis triggers sudden financial collapse as income falls and costs soar.

Under current rules, dying patients must provide medical proof that they have less than a year to live — the new test requires only that death be 'reasonably expected' within 12 months.

Torsten Bell said people facing terminal illness 'shouldn't have to go through red tape to get at their own pension savings.'

Automatic enrolment has brought workplace pension saving to just under nine in ten eligible employees, giving the reform a substantial reach.