Care fees advice must be expert & independent
News that HSBC is closing its long-term care advisory arm to new business highlights the importance of expert and independent care fees advice.
The Nursing Homes Fees Agency (NHFA) is closing to new business on 1st July.
HSBC Actuaries and Consultants purchased NHFA in 2005 before transferring it to HSBC in 2009.
Banks should play no role in providing advice on care fees planning.
It is a specialist advice area which requires a high level of expertise and experience. In addition to the mandatory care fees planning qualification which an adviser must hold, a suitable degree of experience and access to experts for technical support is crucial.
Care fees planning also requires independence to ensure best advice is delivered. Advice about care fees planning should be independent in two respects.
It needs to be independent from product providers, as the best deal is never consistently available from a single product provider. Looking specifically at immediate care annuities, the price for these can vary massively between providers.
Care fees advice also needs to be independent from a product solution.
The full range of options needs to be considered when deciding on the most suitable way to structure assets to pay for care. Working with an adviser who is only remunerated when they sell you a commission paying product fails this independence test.
Whilst there is a need for more suitably qualified and experienced care fees advisers in the UK, to deal with the growing demand for this type of advice from an ageing population, we welcome the news that HSBC has left the care fees advice market.
Photo credit: Flickr/Jim Linwood