New Research from UK life insurer AIG Life Limited shows the pandemic is generating demand for protection insurance through work. However consumers are concerned about the costs of buying cover themselves. The study involved just under 1000 people and makes interesting reading since it has been the self-employed who have suffered the biggest hit to their earnings, not the employed, during the UK lockdowns. Yet it seems that the fully employed want their employers to fund critical illness and income protection insurance for them, despite the government funded furlough scheme.
Nearly two out of five (37%) of employees said the health crisis has prompted them to think they want their employer to offer more protection insurance such as life insurance, income protection and critical illness. The ongoing pandemic is encouraging another 30% to find out more about the protection insurance available from their employer, the nationwide study found.
It is younger workers who are most focused on protection insurance from their employers – around 58% of under-25s want more protection insurance available through work while 61% are planning to find out more about what is already on offer.
However, the research from AIG Life, the UK life insurance arm of global insurer AIG, shows part of the reason is that customers fear they cannot afford to buy protection cover on their own. Around 55% said they believe individual cover is too expensive.
Lee Lovett, Managing Director, Group Protection at AIG Life, commented: “The coronavirus crisis has brought into sharp focus for millions of us the need to have a financial safety net in case illness prevents us from working or, in the worst case scenario, where coronavirus leads to the death of a breadwinner.
“Employers cover around 13.1 million people in the UK by providing group risk insurance, including life, critical illness and income protection, so it makes sense for employees to better understand the cover that is available through work.
“It is a concern that so many people believe individual protection insurance is too expensive for them. That is not the case and we would urge them to use online services such as The Money Advice Service or speak to a financial adviser to find out what is available.”
Views around the country
People in London and the North East are the most likely to want more protection insurance from employers while employees in Northern Ireland as well as those in London and the North East the most likely to find out more about protection insurance already available through work. Those who lived in Wales or the South West of England had the lowest expectations when it came to employers offering income protection, life cover or critical illness support.