For some time people seem to have been talking down the long term care insurance market. It has been...
For some time people seem to have been talking down the long term care insurance market. It has been described as a flat market waiting desperately for the Government to respond to the reports of the Royal Commission.
This has not been my experience in the last few weeks. The recent level of interest among IFAs has been way in excess of expectations. We too had been fooled by the doom merchants into believing that activity was subdued.
This growing interest from IFAs has been demonstrated in various areas. Quotation requests are much higher than expected, applications are flowing in and requests for literature are plentiful.
Of even greater importance to the continuing expansion of the market is the unexpectedly high volume of requests to attend training courses.
It is becoming ever more apparent that there will be at least two important political events this summer. The Government has committed itself to a response to the reports of the Royal Commission. In addition, the committee recently formed to consult with the industry and other interested parties is also due to report in the summer.
During a recent debate in the House of Lords, Lord Lipsey, in talking about the much anticipated response from Government to the Royal Commission, made it clear that when the response comes many people will realise for the first time that, contrary to their present expectations, the State will not fund all their care needs for them and, if they want to leave legacies to their children or to keep their money, they must insure for it.
The remit of the committee consulting with the industry is to see how long term care insurance and other financial products could be made more attractive to a wider audience. When the committee reports, the Government expects to have a better idea of the future size and shape of the market.
It also expects to be able to assess in more depth the risks to vulnerable customers and form a judgement as to their needs in respect of information and other forms of protection. It will also be able to assess the products, including the complexity described, whether sales of those products fall technically within areas already subject to regulation and the costs and benefits of further regulatory options.
Once all these reports are made public then the resulting media attention is likely to lead to a rapidly increasing demand from potential customers. It is good to see that more and more intermediaries are getting themselves ready to take full advantage of this increase in interest when it occurs.
In the meantime, it is still important that we give our clients and potential customers good advice about the different methods available to plan for future care needs.
