UK families unprepared and unable to cover outgoings if unable to work
25 November 2024
Families unprepared to cover outgoings if unable to work
New research from Vitality has highlighted that families across the UK with children under the age of 18 are ill-equipped to cover outgoings such as their mortgage, rent, energy bills and the weekly shop, should a parent be unable to work due to ill health.
The research, which surveyed parents of children under 18, found that nearly half (45%) of them would cut back on their car use if they didn’t have an income for 4-6 months. It also found that around four in ten (44%) would either cut back or be unable to afford to buy clothes and around four in ten (44%) would either have to cut back on holidays or go without them.
The majority of parents surveyed were confident they would be able to get by in the short term if they were unable to work, with 77% confident they’d get by for a month. However, this confidence drops the longer they are unable to work, with only 54% confident they could get by for 6-12 months and 44% for 1-2 years. Comparing this statistic with Vitality claims data, it shows that the majority of Income Protection claims continue beyond two years highlighting the vulnerability of so many households.
Concerningly, the research found that while almost one in five parents (17%) admit they do not know anything about Income Protection, despite having heard of it, highlighting the importance of the industry better demonstrating the value of IP and the protection it could offer them.
Justin Taurog, Managing Director of VitalityLife, said: “Our research shows that by not planning for such an eventuality, parents are potentially leaving themselves and their families at risk of being in a desperate financial situation.
“It also highlights the lack of understanding as to what Income Protection is and the opportunity for us that bringing these products to life could offer, not just for us as an industry but in opening up protection to more people and giving them safety nets to support them and their family should they ever be in the unfortunate position that they need to fall back on it.”
The data also found that around four in ten parents who did not have Income protection (44%) said they didn't think they could afford it, around a quarter (24%) said they don’t see any value in it, and one in ten (13%) said that they would like to have it but haven’t got around to purchasing it.
The research, which surveyed parents of children under 18, found that nearly half (45%) of them would cut back on their car use if they didn’t have an income for 4-6 months. It also found that around four in ten (44%) would either cut back or be unable to afford to buy clothes and around four in ten (44%) would either have to cut back on holidays or go without them.
The majority of parents surveyed were confident they would be able to get by in the short term if they were unable to work, with 77% confident they’d get by for a month. However, this confidence drops the longer they are unable to work, with only 54% confident they could get by for 6-12 months and 44% for 1-2 years. Comparing this statistic with Vitality claims data, it shows that the majority of Income Protection claims continue beyond two years highlighting the vulnerability of so many households.
Concerningly, the research found that while almost one in five parents (17%) admit they do not know anything about Income Protection, despite having heard of it, highlighting the importance of the industry better demonstrating the value of IP and the protection it could offer them.
Justin Taurog, Managing Director of VitalityLife, said: “Our research shows that by not planning for such an eventuality, parents are potentially leaving themselves and their families at risk of being in a desperate financial situation.
“It also highlights the lack of understanding as to what Income Protection is and the opportunity for us that bringing these products to life could offer, not just for us as an industry but in opening up protection to more people and giving them safety nets to support them and their family should they ever be in the unfortunate position that they need to fall back on it.”
The data also found that around four in ten parents who did not have Income protection (44%) said they didn't think they could afford it, around a quarter (24%) said they don’t see any value in it, and one in ten (13%) said that they would like to have it but haven’t got around to purchasing it.