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Scotland funding move set to boost LTC market

The long-term care market in Scotland is set to boom following the Scottish Executive&#39s decision to extend funding to personal as well as nursing care, claim IFAs and LTC providers.

They say the announcement in last week&#39s budget to commit£200m in funding over the next two years will make LTC insurance more affordable and more IFAs will start selling it. LTC insurance has been criticised in the past because of its prohibitive cost.

The situation will change in Scotland because, as the state covers more of the cost of residential care, individuals can insure themselves for less.

The decision will put more pressure on the Westminster Government to extend funding in the rest of the UK in a similar manner but product pro-viders say it is unlikely to do so.

The Government has said it will pay for nursing care and not personal care but has yet to offer a definition of what constitutes either.

There had been predictions that if Scotland were to hand out more cash, there could be an exodus of elderly people from the rest of the UK to Scotland to take advantage of the extra funding.

But IFAs claim this is unlikely because people want to be close to their families at times of ill health.

Age Concern Financial Partnerships director Peter Gatenby says: “LTC is such a narrow market because it is so expensive. This decision will open up the insurance market to the average person in Scotland instead of just the well-off.”

IFA Nursing Home Fees Agency partner Philip Spiers says: “There is still going to be the accommodation costs which account for more than half of the overall costs. The LTC market in Scotland will benefit as a result of this decision.”

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