Page 25 - CPB March 21st

You may have to meet future shortfalls if care home fees increase above current indexation, your care needs escalate, or your pension income decrease
The return of the actual property may no longer be an available option upon your death
period, you have a limited right to terminate the Care Property Bond. The rig ht to term i note the Care Property Bond would only be exercisable during your lifetime in the unlikely event that you made a significant recovery and was assessed as being sufficiently fit and healthy so as not to require residential care. However, please note that the property will have been mortgaged and is likely to have been let out to a tenant. Substantial upfront costs will also have been incurred and, therefore, it will not be possible to return you to your original position. If you were to exercise your right to cancel or terminate the Care Property Bond, the property may have to be sold by Shaw Insurance in the open market in order to repay the mortgage.
The income payments from the Care Property Bond are reviewed and changed in line with the Consumer Price Index each year plus one per cent. If your care home fees increase substantially for whatever reason, the income payments may prove to be insufficient to meet the cost increases and you may need to fund a higher proportion of your care home fees from other sources.
Currently the rate of inflation is relatively low. However, it could rise substantially
in the care home sector due to increasing wage costs, property costs and statutory regulation. The prospects for the economy may change leading to above average increases in the rate of inflation. Whilst the Care Property Bond will be indexed-linked to CPI plus one per cent, it is meant to top up your other pensions and investments which may not be inflation-proofed to the same egree. The measure of inflation affecting care home fees could exceed the indexation due under the Care Property Bond.
The payments under the Care Property Bond are due to be made to the registered care home of your choice which will top up your pensions to pay for your care. The amount of any pensions that you receive may be subject to change. Please note that the taxation of any pension income may be subject to review and change in future. There is a risk that there may be a shortfall in meeting care home fees.
We live in an uncertain world where property values and rental values may fall and in certain severe circumstances they may lead to breaches of borrowing covenants. A property is at risk of repossession should there be any failure to meet any mortgage payments by Shaw Insurance Group. In these extreme circumstances,