The long term care (LTC) market has been hit by further bad news following Norwich Union's (NU) anno...
The long term care (LTC) market has been hit by further bad news following Norwich Union's (NU) announcement that it is to withdraw from the pre-funded market and focus on the immediate needs sector. Its Future Assured product will no longer be available after 5 January 2004.
The news follows further upheaval in the sector occurring over a matter of weeks. AXA PPP Lifetime Care announced it was withdrawing from pre-funded LTC insurance and NU also announced the withdrawal of its LTC bond from the market.
NU has said it will continue to accept pre-funded applications received before close of business on 30 January 2004, provided they are accompanied by a new business illustration. All pipeline applications must be underwritten and current on or before 1 April 2004.
Dean Critchfield, retirement market manager at NU, said the lack of growth in the market prompted the decision.
"The decision to withdraw from the pre-funded market is entirely a commercial one. We have seen no growth in this sector of the market despite continued investment and effort and our decision to withdraw is a commercial one."
Graham Fidoe, chairman at IFACare, said the decision was a huge blow to the market, but he remained optimistic about the future. "Norwich Union's announcement is extremely disappointing, but not surprising".
Fidoe added that the launch of the Pension Annuity Friendly Society's pre-funded product could help the market take a different direction.
