The average age of those looking to put income protection (IP) in place has dropped dramatically since the outbreak of Covid-19, according to protection insurance broker and comparison service ActiveQuote. Enquiries via the ActiveQuote site from those under 25 rose by more than 400%, by more than 300% from those under 30 and by more than 250% among those under 35 year in March 2020, compared to the same time last year.
Signs the crisis is already beginning to affect a new post-Covid generation of employees are beginning to emerge after the number of enquiries from customers aged 20 and under also rose five-fold in the same period.
Overall, customers enquiring about IP via the protection comparison site were two years younger on average in March 2020 than they were in February – which represents the biggest month on month decrease in over 14 months, and is four years younger than at the beginning of the same period.
Rod Jones, Head of Partnerships at ActiveQuote, said: “Income Protection has traditionally been something that consumers in their early 40s look to consider, but since the pandemic hit in early March the average profile of enquirer has been edging closer to the mid-30s.
“The average age of a would-be policy holder has been growing steadily younger since January 2019 but dropped by two years in March this year alone, after the outbreak of Covid-19 and subsequent lockdown was confirmed here in the UK.”
“This is a significant margin by anyone’s standards and possibly an indication that the outbreak has pushed a new generation of employees – who were already beginning to appreciate the need to protect themselves should they be unable to work – into being sooner than expected,” Rod added.
There are four main types of income protection insurance – mortgage, redundancy, loan and accident and sickness cover – which are available as individual policies or as a package depending on your individual circumstances.
Each policy type is designed to cover a range of general living costs in the event that the policyholder is unable to work for whatever reason.
The average age of those seeking IP cover through ActiveQuote dipped more sharply in March than across the entire 14-month period leading up to it. It then rose again slightly from age 36 to 37 in April, which is still two years younger than the average customer approaching the site for the same reason back in April 2019.
Rod said: “Like any insurance product, the earlier income protection cover is put in place the greater the benefits it is likely to bring, both to the policy holder and the loved ones many are seeking to protect by acquiring it in the first place.
“Insurers have long been championing the benefits long-term IP can bring and if there are any silver linings to be had from the hardships many are unfortunately experiencing now, it’s that the UK workforce as a whole looks set to be better protected in the future as a result.”
ActiveQuote is the UK’s leading comparison website and broker of health and protection insurance products, including private medical insurance, income protection, life insurance and critical illness cover.