WITHOUT A SUFFICIENT FINANCIAL BUFFER, AN UNFORESEEN HEALTH ISSUE COULD BE CATASTROPHIC

In the current economic climate, financial stability seems more out of reach than ever for many households across the UK. Recent research reveals a significant gap between our desire for security and the actions we actually take to attain it. Half of the UK’s workforce admits they would feel much more financially resilient if they had cover in place to protect their income should they be unable to work due to illness or injury [1].

Despite recognising its importance, a significant gap remains. Only 27% of UK workers currently have an Income Protection policy. This gap shows that while we understand the concept of a safety net, far too few have actually established one. Income Protection is often regarded as a luxury or an afterthought, but the data demonstrates it should be an essential part of modern financial planning.

COMPLEX WEB OF FINANCIAL RELIANCE

The importance of this type of cover becomes evident when we consider who depends on our income. The data show a complex network of financial reliance. On average, each worker supports three dependents who rely directly on their earnings. This burden often goes beyond children and partners; three in ten workers (29%) also care for a pet that depends on them for food, shelter and wellbeing. Among parents with older children, nearly half support the same number of dependents, indicating that financial responsibility does not necessarily end when children reach adulthood.

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Source data:

[1] LV= Reaching Resilience report: the data used come from a survey of 2,720 nationally representative UK workers, conducted for LV= by Opinium between 15–25 October 2024.

This article is for information purposes only and does not constitute tax, legal or financial advice.