A fifth (18%) of UK workers said they did not see the need for insurance products such as income protection as the cost-of-living crisis batters household finances.
This was one of the findings of a study by The Exeter on the health and financial fear of UK workers.
It showed that 8% of workers did not know what the insurance products were, and a further 9% said they would like to know more but didn’t know where to start.
The study also showed that despite 43% of working age adults worrying about loss of income due to personal illness or injury, only 17% have, or are in the process of applying for, income protection policies.
The Exeter said workers in London, compared to the national average, were the most concerned about a loss of personal income due to illness or injury.
Among those surveyed 47% of workers in London worry about loss of income as against the national average of 43%.
London also reported the second highest level of workers with income protection policies at 26%, 9% above the national average.
While workers in London are the most concerned about a loss of income due to illness, they are the least concerned about the cost of products.
Of those London workers without income protection policies, only 47% reported that this was due to the affordability of insurance products – the lowest rate for any region of the UK.
Self-employed workers still exposed
The number of self-employed adults with any form of insurance in 2022, including an income protection, health insurance, life cover or a cash plan product, was only slightly lower than the UK average (46% compared to 48%).
This is despite self-employed workers having less of a safety net in the form of employer sick pay or employer-funded health insurance, The Exeter said.
However, more self-employed adults in 2022 are concerned about a potential loss of earnings due to personal illness compared to 2019, before the pandemic (46% compared to 34%).
This corresponds with a rising level of income protection for this demographic, with 17% of self-employed adults now having a policy, compared to only 9% in 2019.
The Exeter head of protection distribution Jaime Page says: “The cost of an unexpected illness can have a profound impact on a person’s financial wellbeing. Above anything else, our Challenging Times report has highlighted how, regardless of age or region, workers in the UK are concerned for their health and financial future.
“With such a substantial proportion of people evidently worried about loss of income from illness, it’s up to insurance providers and advisers to make sure consumer education on protection products is reaching as wide an audience as possible and they are aware of the benefits of having a safety net over the monthly cost of paying an insurance premium.”
