The High Price of Living Longer: Pay-as-you-go or No Frills Aged Care?

The Productivity Commission's controversial recommendations for aged care have provided food for thought for policymakers, insurers and many older Australians. The news that an aging population must fund its own care costs, where possible by drawing on that treasured asset, the family home, was only the beginning. The insurance industry is confronting market failure for its inability to provide long-term care products. While many are hoping the government will pick up the slack, a few older Australians already have taken flight for less costly living offshore. But, as Australian School of Business actuarial professor Michael Sherris says, the huge issue of funding aged care won't go away so readily.