To wonder why you can't get social care insurance?

[coconuttella]

The cost of social care for the elderly is increasing inexorably as more of us live to old age, but whilst healthcare is free at the point of delivery, social care isn't.

Why can't we have a voluntary social insurance scheme. If you pay in then your social care costs will be covered, and you would be exempt from massive charges that many with even quite modest income and wealth are charged. Premiums may be quite high but I reckon many would prefer that than be faced with the prospect of losing their home and savings if they're unlucky enough to require long term residential care at the end of their life - I definitely would look to purchase it. I can see some issues such as the length of time you'd need to pay a premium in order to qualify for all your care to be covered, but I don't see why these type of issues couldn't be ironed out. It would save a lot of elderly people a lot of the anxiety and guilt they currently feel and not cost the taxpayer a penny. It would be voluntary - if you didn't pay, the current arrangements would continue.

Obviously raising taxes is another solution but the Tories are reluctant to do this and Labour have alreadt made substantial promises.... and besides, it could be done in conjunction with more investment from the Government, it's not an 'either/or' thing.

Why is no one doing this?

it levels the playing field in this respect between working class and middle class people.

Unfortunately upper class/ v wealthy aren't levelled too!

Why can't we have a voluntary social insurance scheme. If you pay in then your social care costs will be covered, and you would be exempt from massive charges that many with even quite modest income and wealth are charged.

Or, just an idea, a wider scheme where everybody pays in, and the money is invested for providing future care ?

It would need a snappy name. Maybe if such a scheme were to be run across across the whole country, we could call it National Insurance ?

It's a Tory hallmark to try and trick the public into paying for things twice.

TBH I think the days when children can expect an inheritance are over.

"Expecting" an inheritance is entitled, but with assets and wealth being in the hands of the older generation, of course there will be a lot of inheritance.

I get some of you want a socialist system where the state pays for everything.... but even Corbyn's Labour Party aren't proposing free social care for all irrespective of means! So in the absence of even the most left wing Labour Party in a generation proposing the total socialism advocated by some on here I'm proposing another solution.

As I get old I would expect to have a home... as many millions will. I also think it is reasonable that if I have a large estate that it is subject t inheritance tax. However, I also think it's reasonable for me to want to pass on an inheritance to my children, and not to play a lottery with social care that means if i die after a short illness I can pass on, say, £300,000, but if have social care issues I can only pass on a tiny fraction. I'd like to be able to spread the risk. I'd be happy with a large excess, say £25k, as this would be to guard against massive costs that affect a minority of older people.

I really don't think this makes me some kind of Tory die-hard!

We are in our 30s now with young kids and wouldn't take out this kind of policy because we have more pressing demands for our money now, and if we had extra money now we'd either use it for savings that would benefit our family sooner eg house deposit, living close to a good school, or work less and spend more time with our kids. We also spend a fortune on rent as we want to live close to high paying jobs and be able to commute within childcare hours. So right now we have better priorities than giving our children a larger inheritance (which they prob wouldn't receive until their 50s+)

When our kids have left home we will probably have more disposable income, be able to live in a cheaper area and smaller house, and yes might be interested in such a policy. But by then we will be in our early 50s and an insurance company wouldn't find it economical to insure 50+ year olds for social care given that a high proportion will need it. So the premiums would be v high and probably many wouldn't choose it.

Hopeless

I agree it's something people would be more likely to consider once they're in their fifties, but in the basis that people tend not to need major social care interventions until their 80s or 90s that's a 30-40 year period, which would help keep premiums lower. Also, premiums would depend on what yo're insuring against... i don't see this as necessarily insuring against all social care costs, just against a case where social care bills become astronomical and had a substantial impact on your inheritance, so they'd be a large excess. Most people don't spend £100,000 on social care, but some do.... it's managing the risk that you may be one of the unlucky ones in the £100,000+ category.

I imagine we will see more of these insurances being offered as more people become concerned about social care, definitely an interesting idea which will appeal to some.

Two concerns I'd have

1. It's hard for the customer to assess how good a complicated insurance product is.

Have known people in US who diligently pay for medical insurance for years then when they try to claim find that there are various exclusions and the product doesn't meet their expectations. Eg certain treatments excluded, lifetime maximum claimed (although now abolished, but this of course pushes up premiums), something deemed due to a pre existing conditions, frequent co pays, finding out their policy won't cover the hospital or doctor they want/ need. When you get a huge document of detailed policy conditions before you sign up it can be hard to assess how these could impact you. I'd worry about paying in for decades and then finding out the policy didn't cover what I needed/ wanted.

1. There is a degree of subjectivity about what care people need. Social services offer max 4 x 15 mins care at home for most people, which they deem meets their needs. I personally doubt that meets any of their needs! If the insurance company is only funding similar levels of care to SS many people might see this as not worth paying for. OTOH if the insurance covers high levels of care perhaps it will be v expensive, given that the social care bill is already v expensive for what is offered. Will the customers get a choice? I would prefer to live in a nice home rather than live alone with carers popping in but this would be more expensive, will my insurance company pay for this choice? If not maybe I'd be better saving my money so I can exercise more choice, and hope I have enough money.
2. Another one ... The US medical care is massively expensive partly be cause insurance allows costs to go up. Friends who are doctors who received care in US reported having lots of completely unnecessary tests, which create income for hospital, as insurance company pays the bill. Would worry care homes would up their fees if they knew the insurance company was paying, rather than more price sensitive individuals.

I'm not against the idea, but I have some reservations about it. And I'm wary of pushing more costs and responsibilities onto individuals unless it is clearly going to help them.

Hopeless

You raise some interesting points which illustrate that such a product may be tricky to implement.... But they are necessarily insurmountable.

In terms of cost, i don't think it needs to be that expensive if the excess was high.

For instance, (and these figures are no more than educated guesses) if I assume that 20% of older people will need social care costing more than £25k in their lifetime, and that the average cost of those paying more than this was £75k (but with some increasing to £250k+), if i set my excess at £25k, the average payment would be 20% x £50k (i.e. £75k less £25k) = £10k

If average age for going into care was 80, and I was 50 when I took out the policy, I'd be expected (on average) to make 30 years worth of contributions...

Crudely, these contributions would need to cover £10k costs + say 20% profit margin.... that's £400 per annum so broadly similar to
car or home insurance.

I'm thinking the Tories manifesto announcement on social care cost threshold of £100k from £13k has awakened interest in this manifest unfairness in how we resource health versus social care, and that (if we can't solve it by fully funding it - no party is proposing we do) that £100k limit makes developing insurance for this easier. Yes, it's not a perfect solution, but it's better than having the value of your £300k home (i.e. A home typical of a working class 50 something in south east) plundered to pay for care costs.

I've come over from the other thread coco!

It probably would be popular if the premiums were low enough, although I myself wouldn't pay for private insurance because of the risk of it not paying out due to exclusions/eligibility conditions etc.

So I will take the other risk instead! The large majority of people still die without needing social care I think.

I am really worried about this. My Mum died of dementia and needed a lot of care towards the end, we looked after her within the family for as long as we could but when it got to her needing 24 hour care we had to get outside help which was expensive. I am terrified I will also get dementia, and I don't want my DC to have to look after me, it is incredibly hard work, especially if you have career and family commitments of your own.

However, one of my DC has a disability which may severely restrict their ability to earn a living. I would therefore like to be able to leave them some of my assets so that I know they will be OK once I am gone. I cannot rely on the state to help them as it is cutting so much support for disabled people. So under current proposals I would have to somehow pay for my care and pay for their care too. It is a terrifying thought. Not everyone who wants to leave money to their children has 'entitled' offspring. I just pray I don't get the evil dementia so that there is something left to leave them.

Given that many people struggle to save for a pension at the moment, I can imagine this would not be a priority for many people.

There would still be a huge proportion of people who either can't afford to, or choose not to, put money aside for care. So there would still need to be government care provided. It would just change who and how we pay for care if we end up paying (ie pay through insurance not through savings) and all that would happen would be an insurance company would be creaming a profit off an already expensive and overstretched system.
Plus, in the way vets bills and whiplash claims and everything else that's now covered by insurance have got more expensive, won't the cost of care increase as insurance companies will just pay it?

an insurance company would be creaming a profit off an already expensive and overstretched system.

Exactly.

I'm not saying this is an ideal situation... but if we face reality that social care isn't going to be funded by the State (Tory, Labour or whoever) them surely having insurance as an option is better than not having the option.

In the same way the State aren't going to pay for stuff stolen in the event of a burglary... I don't have to have contents insurance, and I may struggle to afford it, but at least I have the option! I can't find anything that someone like me (in 40s) can consider, even if only to discount as being to expensive or risky.

f we face reality that social care isn't going to be funded by the State

This isn't necessarily reality at all. If we all pull together we can do it. Maybe the bankers and Playboy's can pitch in?

As the vast majority of us will need care when we get older

I also disagree. Some need care for 10 years. Some need care for 10 minutes. It all depends how long you live, what sort of things afflict you as you get older and what family support you have.

My father had Parkinsons but lived in a retirement flat, paid for a cleaner himself and got meals delivered that he just needed to microwave. He only needed to go into a care home for the last six months of his life. That did take a chunk of money (nursing home was £1200 a week minus attendance allowance and an NHS subsidy which took about £200 a week off the cost) but it could have been far worse, it was good he was able to look after himself for so long. Equally, a friend of his who died recently died in his sleep at the age of 83 having had no care needs at all. And my aunt has been in a care home since early 2015, which is swallowing up my cousin's inheritance but she asked her to move there, so presumably she decided that she'd rather have the money spent than worry about her living on her own.

I also took the view that I would rather the money be spent than I get any of it. In the event there was enough left to pay off my mortgage and the rest is in savings for my son's uni fees but if that had not been the case, well so what? An inheritance is not a given - and maybe people could give a bit of money to their kids a bit earlier in life rather than keeping it all tied up in houses that are too big for them, as I also said on the other thread.

But I do favour insurance because we don't expect people to find their healthcare in younger years, and we should not expect people to fund social care (which is really health care) in older years either.

fund not find

Unfortunately upper class/ v wealthy aren't levelled too!

A serious question:

Why here do the super rich go unchallenged? I mean on all of these posts about politics.

Do you guys feel they are untouchable? That those who cause these great crises float above laws and responsibility?

Because they always get a free pass here.

Nobody wants to take hack at this?

They just get a free pass?

This was doing the rounds on twitter earlier about insurance for social care and premiums. Not sure how true it is but if it is then it could be disastrous

Teabag. Noted!

Thanks teabag I'd was going to do some digging to see what was behind their 'products'. All will not be as it seems and someone will be making a fat profit on them.

Am I missing something or are the government only able to take what they have paid out for from your estate then the rest is left. So just because you may have £600k over the protected £100k doesn't mean they will take the entire £600k. It means they may take anywhere from say £12k (as an example of care costs) upwards. If people have the funds they should pay for their own social care, not health care, but social care.