Putting it another way, are pension annuities and other sources of retirement income sufficient to pay for future long term care fees, should they be needed. Saving for long-term care presents a bigger challenge than saving for a pension, industry experts have claimed.
Stephen Haddrill, director general of the Association of British Insurers (ABI), said recently it would be an uphill struggle to get people to save for their own long-term care. He suggested there should be an element of risk sharing between providers, the state and individuals. There is a need for more product development to encourage proper planning, to encourage people to want to plan, possibly in the annuity arena.
75% of annuity pension pots are below £25,000. When pots grow bigger in the future there will be scope for innovation then, but not now.
The issue of long-term care is being challenged by the fact most people believe the state is responsible for their long-term care. Many believe it is a cost they should not have to bear.