Women are heading for poverty in later life, a Chartered Insurance Institute report has warned.

Longer life expectancy means the average cost for women entering a care home from 65 –74 is £132,000, nearly double the cost of men's, according to the research.

The study cited figures showing the average man accumulates five times the pension pot of the average woman.

Women now earn the same as men their 20s but are overtaken at age 30.

The report by Insuring Women’s Futures, a programme established by the CII to support the insurance profession’s role in relation to women and risk.

The study showed that the average woman was outperforming the average man in education and earned as much as men in her twenties.

But a significant pay gap opens from her early thirties, and by her fifties, she typically earns 16% less than a man of the same age and is more likely to be in insecure employment.

The report stated: “Her 30s are typically spent caring for children, alongside part-time or temporary work, and in her 40s and 50s she may also be caring for an adult. The pay gap coupled with loss of earnings through unpaid care, has a huge impact on her ability to save and bounce back from hardship or plan for her financial future.”

The average man accumulates five times the pension pot of the average woman by the age of 69, with a man having £179,091 and a woman of the same age having just £35,800. For divorced women the situation is considerably more precarious, with average pension pots worth a mere £9,019 compared with £30,341 for divorced men.

Although women in long-term relationships may expect to share their partners’ pension wealth, the research showed these patterns of pension wealth leave women vulnerable in the event of a split. Women were shown to be more likely to rely on a partner or the state for their income in old age (48% of divorced women compared to 38% divorced men).

Insuring Women’s Futures is setting up an industry task force to address this issue bringing together the insurance profession and other sectors and bodies, including the Government, to consider solutions to tackle this.

Jane Portas, IWF Committee lead on Women's Risks in Life and PwC Partner said: “I encourage men and women, both in the insurance and Financial Planning profession, other bodies, and society at large, to study these findings and play a role in shaping our approach to risk in the future.”

Sian Fisher, CEO of the CII and Chair of the IWF committee, said:
“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.”