Immediate Lifetime Care

The Immediate Lifetime Care plan is for clients already suffering from physical or mental disability, who are either already receiving or about to receive care. For a single premium it aims to pay part or all of the costs of a client’s care for the rest of their life.

Clients must be aged 60 or over and be receiving care because they need assistance with everyday tasks, or need constant supervision due to conditions such as dementia.

 

Benefits and options

We’ll pay your client’s long-term care benefit immediately as long as they're receiving care. The maximum benefit is £8,000 per month. The minimum is £200 a month. There is no surrender value either before or after the benefits become payable.

 

Payments and legal representation

The plan is set up by paying 1 single premium. If your client is unable to handle their own affairs, a legal representative can act on their behalf.

The maximum single premium is determined by the maximum care benefit of £8,000 per month. The minimum single premium is determined by the minimum care benefit of £200 per month.

 

Inflation protection

If they’d like to, your client can help protect their benefits from inflation by choosing one of the following options before the plan starts:

• Yearly increases in benefit at a fixed rate between 3% and 10% each year (whole numbers must be chosen)
• Yearly increases in line with the Retail Prices Index
• Yearly increases of 2% more than the increase in the Retail Prices Index

Your client can also choose in which month the annual increase takes place, to fit in with their arrangement with their care provider. The increased amount applies for the full month in which the benefit goes up. We will make the increased payments automatically.

 

Premium protection options

Clients can select our optional premium protection benefit, which can be long term or short term. The benefit comes from a separate term assurance plan which has no cash-in value. 

Option 1 - Long-term premium protection

• Clients can choose to cover 25%, 50% or 75% of the total premium they’ve paid for the Immediate Lifetime Care Term Assurance plan and the Immediate Lifetime Care Plan
• The amount paid when the client dies will be the amount covered minus the amount resulting from multiplying the initial monthly benefit by the number of complete months since the plan started
• If the monthly benefit payments we’ve made exceed the protected percentage chosen, the term assurance will end and the estate will not receive any payment on the client’s death

 

Option 2 - Short-term premium protection

• Clients can choose to cover 25%, 50% or 75% of the total single premium paid for the Immediate Lifetime Care Term Assurance plan and the Immediate Lifetime Care Plan, but only for. a limited period after the start of the plan 
• They can choose to protect the selected percentage of the premium for a period of 3 to 6 months from the plan’s start
• They can select a combination of periods and percentages. For example, they can protect 50% for the first 3 months, reducing to 25% for months 4 to 6
• The amount paid when the client dies will be the amount covered minus an amount equal to the number of complete months since the plan’s start, multiplied by the initial full monthly payment
• Once the chosen period ends, the term of the life assurance finishes

Once the term ends, when the client dies their estate will not be entitled to any payment.

The Immediate Lifetime Care plan is designed for clients who:

• Are suffering from a physical or mental disability and are currently receiving or about to receive care
• Want the peace of mind that all or part of their care costs are covered for the rest of their life
• Want their benefits paid tax-free direct to a registered care provider
• Would like the option of annual increases to their benefits at an additional cost, helping to protect those benefits against inflation
• Want to be able to increase their monthly benefit if their care plans or costs change

It’s unlikely to be suitable for:

• Clients who aren’t yet ready to enter long-term care
• Those who require a guaranteed payment to be left to their estate upon death
• Clients unable to make up any shortfall in care costs over and above the monthly benefit

Things to consider:

• Will the plan cover your client’s monthly care costs?
• Does your client have the means to make up any shortfall in care costs?
• Will the payments from the plan affect your client’s entitlement to any state benefits?
• Is your client aware that the total benefits paid may be less than the amount used to buy the plan?
• Does your client have any tax liabilities to address?
• Is your client aware the cost of care services may rise faster than the payments from the plan?
• Is your client aware that the plan has no cash-in value?

Possible alternatives to a lifetime care plan include:

• Local authority deferred payment scheme
• Equity release
• Investments or cash deposits