Income Protection
Posted on 9th November 2022 at 16:59
On average how many days of cash reserves do people in the UK have before it runs out?
19 days – that really is very worrying.
I recently attended a serious of webinars run by Legal & General during Income Protection Awareness Week and some of the headline numbers are very concerning.
We were given the example of a 35-year-old woman, who is a non-smoker, what would you imagine her risks of becoming ill before retirement would be/
1. She has a 3% chance of dying
2. 11% chance of suffering a serious illness (cancer, heart attack etc)
3. 41% chance of being unable to work for at least 2 months
For those of you who are employed, you probably have the benefit of sick pay and with the more generous employers that can be anything from 3 months to a year, but what happens after that, especially if the condition is long-term. According to the most recent figures from the ONS, the UK is experiencing a 20-year high in the number of people out of work due to health issues. Almost 400,000 have removed themselves from the workplace altogether since the pandemic started.
How does Long-term sick impact the UK economy?
Asides from this being critical to the UK economy, this would be disastrous to the individual if they didn’t have cover in place to protect their ability to pay their mortgage/rent and cover regular outgoings. This could literally be the difference between maintaining a roof over their head or not.
And of course, there are the self-employed, the UK has seen an increase in the numbers over the last 30 years from 3.4 million in 1992, to 4.29 million in August 2022. Just 6% of the UK population have income protection leaving high numbers of the workforce unprotected, especially those who are self-employed and that only rises to 7% for critical illness cover.
As income is the driver to everyone’s lifestyle, income protection is a vital cover to discuss with a trusted financial advisor. Income Protection Week was aimed at our industry, and it did a good job of raising awareness and highlighting the current data and how people in general are being impacted.
For more information on income protection check this out
Tagged as: Income protection, Long-term sick
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