Intermediaries are increasingly in favour of a fully-regulated long term care industry.
Two recent surveys have shown that IFAs believe that if this market is to develop to its full potential, long term care providers have to move towards both standardisation and regulation.
The trend emerged as marketing consultant, Brunswick, published the results of its long term care market survey.
Its figures showed sales still remain small in this market, despite the fact that the number of providers has doubled over two years. Over 100 claims have now been settled or are currently in progress.
According to IFAs, problems lie in the lack of standardisation across the industry, which makes it hard to compare contract terms – especially as premiums can vary by as much as 100% in plans that offer broadly similar cover.
Similar concerns were raised by an Internet-based survey carried out by IFACare, the intermediary association for long term care. The survey was designed to gauge the views of IFAs on this sector of the market.
The results showed a growing demand for advice on long term care; widespread support for a code of conduct; and a broad desire for specialist training for IFAs.
All respondents agreed long term care advice should be regulated under the Financial Services Act. And 93% thought the requirement for specialist information would grow in the future.
Some 98% of those surveyed believe it is imperative that IFAs keep up to date with the legal issues which surround long term care.
Graham Fidoe, IFACare chairman, said: “The results of the survey reinforce our belief that long term care advice is becoming an essential ingredient in financial planning for retirement.
“IFAs are anxious to equip themselves with the knowledge and training they need to provide high quality advice to elderly clients.”
Director of IFACare and consultant with Cheltenham-based Warwick Butchart Associates, Ted Yeates, added that the organisation wanted to see long term care regulated before something went drastically wrong.
“The elderly and infirm are a sensitive area of the population. The potential impact of a scandal would be devastating. We owe it as members of the public to make sure the elderly don’t get ripped off,” he said.
IFACare continues to lobby for the regulation of all long term care products as well as offering advice relating to long term care planning.