Westminster is unlikely to introduce a similar LTC insurance law in the UK
A new insurance law, which will see all residents of Guernsey pay long term care insurance contributions, is awaiting approval from the Privy Council.
Approval is likely to be granted at the Council's next meeting in October. The law is due to come into effect from 1 January 2003, from which date contributions will be mandatory.
Island residents will pay 1.4% of their income in tax to fund an insurance premium, providing their annual income is greater than £10,800.
Unemployed people under 65 and those who have retired will also be assessed. However, they will only be eligible to pay contributions if they earn above the minimum salary level.
If the law is passed, the State-funded benefits will become payable from 7 April 2003 and will be available to those who have been Guernsey residents for at least five years. They will need to have lived on the island for at least 12 months before any claim. A needs test will also be applied before any benefits are paid.
The benefits will cover part of the cost for people who go into registered residential and nursing home care. Residents will have to pay the first £119 a week care costs themselves.
In addition, the scheme will pay out up to £518 a week for a nursing home and up to £260 a week for a residential home, depending on the cost of each facility. Domiciliary care costs are not catered for under the new law.
Discussing the need for the scheme, Malcolm Nutley, chief officer of Guernsey Social Security Authority, said: 'Guernsey has had a mix of schemes that charged for long term care and we have been looking for ways in which to rationalise these existing systems. The working party has decided this law is the best way to address the issue.'
However, Chris Ellicott, legal and technical manager at Age Concern Financial Partnerships, believed the scheme had limitations and it was unlikely that a similar operation would ever run in the UK.
'The operation in Guernsey brings a number of points into question. It is improbable something like this would develop in the UK because the cost of covering everyone is quite high. The problem is that once people start relying on the Government, they will get what the Government thinks they need, not what they, as individuals, want.
'It is the job of advisers to bring to their clients' attention the importance of buying long term care insurance, so they can get the provisions they need and want when they are retired,' he said.
