Half (51%) of those who have been diagnosed with a critical illness, such as cancer, heart attack or stroke, have also faced a shortfall in their income, according to research from Royal London.
The survey of 3,004 UK adults, which was conducted for the insurer by Opinium, also found two-thirds (65%) of those who faced a financial burden, due either to their own or a loved one's critical illness, covered their outgoings using their existing day-to-day personal finances while three in 10 (31%) dipped into their savings.
Royal London group head of protection strategy Debbie Kennedy (pictured) said: "Employees who are too ill to work are entitled to Statutory Sick Pay from their employer - £89.35 per week for up to 28 weeks - but this would not be enough to cover the extra expenses people face when ill or caring for someone who is.
"Worryingly, the study also revealed, one in five (20%) had no savings at all to fall back on if they were diagnosed with a critical illness."
In addition to day-to-day living costs that need to be covered if someone is unable to work, the average additional cost of being ill or caring for someone who is ill can equate to £1,623, according to Royal London.
Its research indicated those with a critical illness attended, on average, five hospital appointments a month, with transport to the hospital, doctor or chemist (at 67%) being the most common extra expense and costing £391 on average.
A third (33%) of those who faced a burden on their finances cited higher utility expenses, averaging £675, while the most costly extra expense was having alterations made to the home - which cost £1,764 on average - although this was a less common occurrence, with only one in six needing to take this action.
Nor does critical illness solely affect the person diagnosed, with Royal London's research showing it can also hit their support network too. "Most people expected family and friends to care for them if they were unable to carry out day-to-day tasks while ill," said Kennedy.
With one in 10 people in the UK listed as carers, the research showed two thirds (68%) of people were working when they were caring for someone who had been diagnosed with a critical illness. More than half (54%) had to take some time off or reduce their working hours as a result of caring for someone with an illness while a third (35%) of people who had to take time off or reduce their hours estimated they took up to a month off work.
"Coping with a critical illness is a worrying time," said Kennedy. "Our research shows that although people expect the illness to have a financial impact they are not prepared, with a fifth not having any savings to fall back on. As increasing numbers are being diagnosed with a critical illness, we would urge people to try to get into the savings habit and consider speaking to a financial adviser about their options."
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