Overview

This bill establishes a publicly owned insurance body to help homeowners avoid selling their houses to pay for elderly social care. The insurance is optional and covers the cost of care up to the value of the insured property.

Description

The bill creates a public, not-for-profit company, the Public Social Care Insurance Body, within two years of the Act's passing. This body will offer homeowners in England insurance against having to sell their homes to fund elderly residential social care. The insurance is optional.

Insurance Cost and Payment

The insurance cost will be a fixed fraction of the property's value (net of mortgage), calculated based on factors like the proportion of homeowners needing care and care costs. Couples can get a joint policy at a reduced rate. Payment can be made via a charge on the property (realized upon death or sale) or a cash payment upfront. Health status will not be considered when setting premiums; the bill specifies that the Secretary of State will decide whether to allow sex-based premium differences.

Care Entitlement

Policyholders needing care will receive local authority-provided care until the cumulative cost equals the insured property's value (adjusted annually by a house price index). The body will reimburse the local authority. After this point, means testing for social care considers only assets and income other than the insured home. The insurance does not affect NHS healthcare or the policyholder’s responsibility for "hotel costs" (accommodation and meals) in residential care.

Timing and Outreach

Homeowners can only purchase insurance after reaching state pension age, within two years of reaching that age. The Secretary of State will attempt to contact all residents of England twice a year during the four years before and after reaching state pension age to explain this insurance option.

Government Spending

The bill mandates government funding for the Secretary of State's expenses related to the Act, and any increases in sums payable under other Acts due to this legislation. The Secretary of State can also provide financial assistance (loans, grants, or other payments) to the insurance body. The body may borrow from the Secretary of State. Specific figures are not provided in the bill.

Groups Affected

• Homeowners in England: They have the option to purchase insurance to protect their homes from being sold to pay for elderly social care, potentially reducing their financial burden in old age. Those who choose not to purchase insurance remain subject to existing care funding regulations.
• Local Authorities: They will provide social care and be reimbursed by the Public Social Care Insurance Body up to the insured value of the property.
• The NHS: The bill clarifies that the insurance does not affect NHS healthcare provided to individuals in residential care.
• The Public Social Care Insurance Body: A new publicly owned body will be responsible for managing the insurance scheme.

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