Long term care issues have hit the headlines once more this month as the country continues to debate...
Long term care issues have hit the headlines once more this month as the country continues to debate a possible solution to the funding crisis affecting Britain's elderly. With an irretrievable savings gap, protection is vital to the country's future wealth.
However, long term care insurance sales are still suffering ' according to General Cologne Re, only 39,000 pre-paid policies have been sold to date.
Guernsey is to introduce mandatory insurance contributions to help provide long term care for everyone who needs it. Is this a lead Westminster should follow? It is unlikely for two reasons. First, the amount this would cost the Government would be enough to have the proposal thrown straight out of Parliament. Second, another tax is unlikely to be welcomed with open arms by the public.
The Conservative Party recently claimed if it came to power, Government-led insurance could be a reality. In its pamphlet, The Care Crisis, it makes brave promises of renewed State help and even tax breaks for people purchasing long term care insurance.
The fact is, it is unlikely any Government will be in a position to offer tax breaks, let alone free care, with resources drained in so many areas of health and social care.
Long term care insurance can provide an affordable solution if people take early action. The problem is that not enough people are doing so. The figures speak for themselves. According to General Cologne Re, while uptake of pre-funded insurance remains low, uptake of immediate needs policies are on the increase.
A recent report by Datamonitor concluded that providers are ignoring the over 50s market and not marketing financial solutions effectively to this group ' the same group that should be fully aware of the looming crisis they could face should they need care.
It is no easy task, but it appears that with no real hope of a radical reform of State contributions, it is up to advisers to make sure clients get the protection they need, while it is still affordable.
Kirstie Redford, editor
l COVER will soon be hosting a Think Tank session sponsored by Swiss Life (UK) to debate long term care issues. If you are interested in attending, please contact Alex Broad on 020 7306 7060.
