Insurance companies are set to spend millions of pounds advertising new
policies aimed at covering care bills for the elderly.
The Government announced this week that it wants new products to be
marketed from next year that enable old people to keep their houses
rather than sell them to pay residential home fees.
But ministers are worried that the multi-million pound campaigns planned
by the insurance industry might play on people’s fears. ‘We do not want
to see scare tactics,’ one Whitehall source said.
Ministers will consider tightening the rules over the promotion of long-
term care products by bringing them under the remit of the Financial
Services Act. At present, marketing is controlled by the insurance
industry’s voluntary code, but it cannot be legally enforced.
In a consultation paper published on Tuesday, the Government described
long-term care insurance as ‘a complex and expensive product with scope
for over-promotion to vulnerable people’.
However, the Government also pointed out that strict controls over
marketing might be ‘disproportionate to the problems likely to be
encountered’ and warned that the cost of complying would ultimately have
to be met by the consumer.
The Association of British Insurers said that the Government’s proposals
were bound to ‘open up the market’.
One of the early entrants is PPP, which has created a lifetime-care
unit. Its healthcare division has set a pounds 20 million ad budget
through M&C Saatchi and Motive following its relaunch last year.