Speaking at the fourth annual ABI Social Welfare to Social Responsibility conference in London last week, O’Brien criticised the industry for failing to produce LTC products that “help motive and incentivise people to set aside money for the contingent event of your long-term residential care”.
He said: “The industry is saying it is ready to give help where it can but nobody has come forward with the products to make provision in this area. Actuarially, it is difficult to price and most people think somehow that council tax and general taxation will pick up the slack in the end, therefore leaving you not having to price the risk. Is that fair?”
Bupa UK and North America division managing director Fergus Kee said the industry has offered LTC products in the past but was forced to close them down because “we just could not make them work”.
He said: “We have all tried and failed quite badly. We cannot do it on our own, we need three legs on this stool. We need the industry structuring products, we need some sharing of the long-term trail and then we need something more creative than tax relief, whether that is some link to inheritance or capital tied up in property.”
PMI provider WPA corporate communications director Charlie MacEwan said the Government needs to decide on a definitive LTC policy before the industry can start to produce relevant products.
He said: “As companies, we are trying to double-guess what the future is in order to produce products and to be frank the infrastructure of the future is unclear.”