Mrs Roberts should consider long term care (LTC) insurance because her assets amount to well over £...
Mrs Roberts should consider long term care (LTC) insurance because her assets amount to well over £19,500 ' the current ceiling for local authority assistance. Unless she insures herself, the fees will soon reduce both her savings and the eventual proceeds from the sale of her home.
First, a detailed analysis of her income and expenditure has to be made. Is her income increasing or level? How much disposable income does she have? How much of her capital could she use to pre-fund her LTC?
Next, the potential shortfall needs to be calculated. Assuming she is awarded the lower amount of Attendance Allowance (£38.30 per week) and the lowest level of Nursing Care Allowance (£40 per week), her monthly shortfall is just under £1,130 a month.
She can insure for this in several ways. She should certainly choose a benefit increasing at RPI or more and decide whether to have her regular premiums level or increasing too.
Single premiums vary between insurers from around £23,500 (Age Concern/ Norwich Union) to £27,000 (PPP Lifetime Care) for benefit payable after a two-ADL failure. Alternatively a £10,000 single premium plus around £96 per month gives the same benefit.
Other options include a benefit payable after a three-ADL failure, a limited claim period, choosing a less expensive home or accepting that she will bequeath less to her family. Whilst the costs will doubtless seem expensive, waiting until she qualifies for an immediate care plan will mean paying a great deal more.
