§ Mr. Matthew BanksTo ask the Chancellor of the Exchequer if he will make a statement on the regulation of selling and marketing of long-term care insurance. [39944]
§ Mrs. Angela KnightThe Government's consultation document, "A new partnership for care in old age", published on 7 May, invited comments on a proposed partnership scheme to provide extra protection from the 549W means test for residential care to people who took out a "partnership product" to meet some of the costs of their long-term care. Two kinds of partnership product for inclusion in the partnership scheme were mentioned-indemnity insurance and immediate needs annuities. Views were also invited on whether the selling and marketing of long-term care insurance should be regulated under the Financial Services Act 1986, as annuities are already.
It is important, especially as these products will be sold primarily to the elderly, to ensure that arrangements for regulating the products are properly considered. Equally, it is important for any regulation to be cost-effective, and widely accepted as effective for the development of the market in long-term care insurance.
The Treasury is examining the issues raised by responses to the consultation document concerned with regulation. These suggest there is a consensus in favour of regulation under the Financial Services Act 1986, covering the marketing and selling of all long-term care insurance products. Before a decision is taken to extend the scope of the Financial Services Act in this way, the Treasury will explore further the detailed question of how it should be achieved, and will issue a consultation document in the autumn seeking views of interested groups, including financial services participants and consumer interest groups.