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The Actuary The magazine of the Institute & Faculty of Actuaries

Care home costs for women almost double that of men’s

The average cost for women entering a care home from the age of 65-74 is £132,000, nearly double the cost it is for men, according to the Chartered Insurance Institute (CII).

Women 'unprepared for the risks that they will face' ©Shutterstock
Women 'unprepared for the risks that they will face' ©Shutterstock

Their Women’s Risks in Life report shows that longer life expectancy, which has increased by four years in the last two decades, has resulted in higher and unpredictable costs of care for women in comparison to men.

Nearly two in three people aged over 80 are women, who will on average face 19 years of ill health, and need nearly three years of help carrying out basic tasks.

CII CEO, Sian Fisher, said: “Women today are left disproportionately exposed to risks that society is not overtly recognising. This is at the same time as historic support systems are receding.

“We are moving from a dependence culture to one of independence, where we will have to be less reliant on our partners, families, communities and the state, and must take charge of our own financial welfare. Yet today’s women are simply unprepared for the risks that they will face in life.

“This is not just a women’s issue, it is a wider risk for society because if we don’t address it now, we will face a huge burden of care that we will not be able to sustain.”

It was also found that while women are more likely to have savings products, on average they accumulate five times less into their pension pots than the average man.

Despite the increasing likelihood that women will require expensive care in old age, it was found that 55% aged 30-39 have not thought how they will pay for this.

In addition, four in 10 of this age group were unaware of the government’s plans to cap care costs, and one in 10 thought that all care was covered by the state.

The Association of British Insurers (ABI), director general, Huw Evans, said: “This report is genuinely shocking in highlighting the significantly greater risks women face than their male counterparts.

“This should be a call to action for government and the financial services sector alike to find meaningful and lasting solutions to the challenges women still face.”

The report suggests that the insurance industry should:

•Educate and raise awareness of the risks of not planning

•Provide equality-oriented solutions

•Engage with employers to develop new workplace risk solutions

•Improve the image of the profession, making it more appealing to women

ABI protection committee member, Johnny Timpson, said: “The industry needs to transform how we engage and support women appropriately, de-risk and protect their incomes, commitments, liabilities and lifestyles.

“A comprehensive strengthening of all women’s safety nets is needed through: access to careers that build wealth; increased financial literacy; improved product solutions; plus better infrastructure for raising children with or without a significant other.”