SALLY SORTS IT: My £7,300 Aviva care cover policy won’t pay out

Twenty years ago, at the age of 70, I took out PPS insurance to cover the cost of care should I ever need it.

I paid a purchase price of € 7,321. The policy, which was later acquired by Aviva, is now worth £1,675 a month for healthcare costs.

In recent months I have had to employ carers. Last summer I needed a hip replacement after a fall and I have had mobility problems ever since.

I also suffer from parkinsonism. My wife helps me shower and dress, but she is 88 and not in good health. She gets very tired so we need extra support.

Of course I thought I could use my Aviva policy to cover some of the costs, but it refuses to pay.

RM, Edinburgh.

Sally Hamilton replies: The rising cost of long-term care is an emotional topic – and many people worry about how they will be able to pay the huge bills if they need to.

The average cost of a residential or nursing home can exceed £50,000 a year. Home care can be just as expensive depending on how often carers visit or if they are live-in.

Two decades ago, you were concerned about these costs, so you decided to get insurance you could rely on if you needed care later in life.

Under the terms of the policy, Aviva agreed to pay the cost of care if you ever needed it in exchange for the lump sum you paid.

When you made the claim on your policy last year, Aviva agreed to pay £5,000 for equipment that could help in your flat.

You were grateful, but haven’t taken the company up on the offer yet. However, it refused to pay you an income to cover the cost of the home care you need.

It said that to qualify you must fail in three activities of daily living. These include moving from room to room; washing and bathing; dressing and undressing; feed yourself with ready-to-eat food and drink; and moving yourself (e.g. to a toilet or from a chair to a bed).

Apparently walking unsteadily with two sticks and needing help with dressing, washing and meal preparation was not enough to trigger the payment.

You felt offended that the policy hadn’t made it clear that you had to fail three activities to be eligible – it just said you couldn’t do some of them. You told me you can only handle it because your wife helps.

I have asked Aviva to check your review. A few weeks later, Aviva decided to meet your claim after all.

It said your mobility issues may be a bigger problem than originally thought.

An Aviva spokesperson says: ‘We have reviewed additional information provided to us taking into account his overall situation and the risk he is at with his mobility.

We are always happy to review any claims decision if a customer provides additional information.”

A monthly payment of £1,675 has been authorized along with £11,348 in payments backdated to October.

You tell me you are immensely relieved. These plans no longer exist for new buyers because insurers deemed them too expensive to run, and demand has been at an all-time high.

If you want a policy that ‘insures’ you against the costs of care, then the best equivalent is a ‘immediate life annuity’, which guarantees a fixed income for life in exchange for a (considerable) lump sum payment. The monthly income is tax-free, as long as it is paid directly to a healthcare provider.

With the help of a financial advisor, I organized such an arrangement for my late mother ten years ago. The care annuity would cover half of her care home bills – which amounted to about £1,000 a week – and she would pay the rest from her pensions and dividend income.

She lived in the house for six years before her death, and the annuity broke even. For example, if she had died within a year of being admitted to care, it would have been an expensive purchase.

But that was a risk we were willing to take so she and the family wouldn’t have to worry about running out of money.

Those without your type of insurance can get government support if they meet certain criteria.

If you have savings of £23,250 or more in England you will not be eligible for assistance.

There is some help for those with savings between £14,250 and £23,250, and maximum support for those with less than £14,250. The equivalent capital limits for residential care in Scotland are £20,250 for the lower and £32,750 for the upper.

In Wales, the thresholds are £24,000 for non-residential care and £50,000 for residential care. Those living in Northern Ireland who have assets in excess of £23,250 will have to pay the full cost of residential care themselves.

In Scotland, all possessions are ignored for those requiring home care, although they must meet strict health criteria first.

You say you are now going to look into what help you can get from the Government as a resident of Scotland.

The government has pledged to introduce a cap (in England) of £86,000 from October 2025 on the total amount a person can contribute to their care.

However, this only covers the nursing and assistance part of the fees. Other elements such as housing, food and utility bills will still have to be met by the individual.

Read more on pay for care.org. For the rules in Scotland, go to advice.scot. Go to gov.wales for Wales and nidirect.gov.uk for Northern Ireland.

Anyone who doesn’t qualify for assistance and has to pay for care right away may need to sell their home or make arrangements with their council to defer payments and pay them back later, perhaps from their estate after death.

They can also raise money by using a home equity loan.

TUI will not refund canceled holiday pay

I booked flights for my wife and I to the Dominican Republic with TUI in December for £2,068.

But the university where I work as a professor makes me redundant, so we can no longer afford the trip. I have emailed TUI’s ‘exceptions’ department to get a refund but never received a reply.

GK, Wolverhampton.

Sally Hamilton replies: Although TUI is not obliged to repay you under the usual conditions, TUI does take exceptional circumstances into account.

While the exceptions department did not acknowledge your requests for a refund, I’m happy to say that once I stepped in to explain your position, you quickly got your money back.

A TUI spokesperson says: ‘We were sad to hear about GK’s situation. We have now spoken to him and found a solution that he is happy with.’

Potential travelers in a similar situation who are not reimbursed by their travel company may be able to rely on their vacation insurance instead, as long as unexpected job loss is covered. Usually, the insurer needs confirmation of the dismissal from the employer.

• Write to Sally Hamilton of Sally Sorts It, Money Mail, Northcliffe House, 2 Derry Street, London W8 5TT or email sally@dailymail.co.uk — include phone number, address and a note addressed to the offending organization giving them permission to talk to Sally Hamilton. Please do not send any original documents, we cannot take any responsibility for that. The Daily Mail assumes no legal liability for answers provided.