Parents with young families 'need protection most'

HSBC Life study reveals

Tweet
Facebook
LinkedIn
Send to

Over half of advisers surveyed highlighted parents with young children have biggest need for protection

A study by HSBC Life has surveyed financial advisers to find out where there is likely to be most demand for protection insurance.

According to the survey, 53% said that parents with young children will have the biggest need for protection going forward, followed by employees with limited access to employee benefits (45%), self-employed (39%), small business owners (37%) and gig economy workers (32%), which are those least likely to benefit from sick pay, holiday pay and redundancy pay.

According to the Association of British Insurers (ABI), a significant number of households are under protected individually. Of the 26.5 million UK households in 2018, 5.4 million had paid towards life insurance but just 0.2 million had some form of income protection.

Meanwhile, the Office for National Statistics (ONS) estimates there are nearly 4.7 million workers classified as self-employed and 2.8 million estimated to work in the gig economy, according to government statistics.

During the coronavirus pandemic, the government's Self-Employment Income Support Scheme only was made available to those with profits below £50,000 and not available to anyone who has become self-employed in the last tax year, leaving many of them exposed financially.

The research also highlighted that one in eight (13%) advisers believed that those still working and over the age of 50 could also need individual protection products.

Mark Hussein, CEO of HSBC Life UK, said: "There is increasing awareness that protection cover is an important investment, both in the short and long term. It is often the case that having children means people think more about the future and consider whether they and their family are appropriately financially protected, should anything happen.

"It is interesting that advisers expect to experience demand from self-employed and gig economy workers. These groups rely on regular work and are unlikely to have the same level of protection offered as those individuals working for an employer offering benefits such as critical illness cover or death in service, so it's vital that they protect their income. Advisers have an important role to play in helping customers of all demographics to understand the need for greater individual protection."

CUSTOMER TYPE	PERCENTAGE OF ADVISERS BELIEVING THESE SECTORS WILL SEE INCREASED DEMAND
Parents with young families	53%
Employees with limited access to employee benefits	45%
First time house buyers	44%
Parents planning / starting a family	43%
Self-employed people	39%
Small business owners	37%
Customers planning for inheritance tax	34%
Gig economy workers	32%
Married / cohabiting couples	30%
Workers in specific trades vulnerable to accidents	22%
Retired customers	14%
Over 50s still working	13%