This morning, The Exeter building society Head of protection distribution Jamie Page sent a message out to all mortgage and protection brokers. In the message he presented a dossier of reporting’s that he and the building society have made in regard to self-employed people, life insurance, and other protection policies.
In their report, they have identified that only 29% of the self-employed people that they have reported on have any form of life insurance policy in place. And an even lower amount had any kind of income protection in place.
What Have The Exeter Said About Self-Employed People And Insurance?
In his report, Page says:
“Our research showed only 29% of self-employed workers had life cover. And just 17% had income protection. This is pretty alarming considering they won’t have access to employer sick pay or added company benefits. Self-employed workers could likely be more susceptible to an income shock than employed individuals. Whether it’s because new contracts fail to materialise, or unprecedented nationwide events hit the economy. Despite income protection arguably holding higher importance for self-employed workers, it’s the least prevalent insurance product.
Although self-employed workers are under insured, there is a heightened awareness of loss and concern. 46% said they are worried about a loss of income due to illness or injury. This presents an opportunity for further education with existing and potential clients.”
To us at Oportfolio as financial advisors, who want our clients to be covered financially in all aspects of life, it shocks us that such a small amount of self-employed people has life or income protection insurance. Becoming self-employed is a big step for anyone. It can be extremely beneficial for some and a huge risk for others. We have already seen a global pandemic come and more or less go in the last 2 years and in that time we have seen people’s incomes drastically change or completely dry up. Despite this, the fact that over half of self-employed people aren’t protected against another huge change to income and earnings is baffling. Especially as we now face a recession.
What Else Have The Exeter Reported?
Page goes on to reveal that 81% of the working population have changed their spending habits because of increases in energy prices, inflation, and National Insurance.
“The changes that workers are making to their spending habits are not just small changes. In fact, almost twice the number of self-employed people in the UK, compared to those in traditional employment, said they had reduced pension contributions in light of the current cost of living increases. 6% had also cancelled insurance products. When it comes to cutting back on such expenses, the self-employed are much more financially exposed and should be considering the long-term risk and implications of these decisions.
Self-employed adults listed affordability as the most important aspect when purchasing an insurance product with 59% saying it was “very important”. And you can understand why, considering the current economic climate. But let’s flip this. When money and wealth is clearly so important to these workers, why are they then willing to risk a loss of income without a backup plan?”
If you are self-employed and sitting there thinking “I don’t have any insurance!”, then give our insurance brokers a call today so that we can get you covered for anything that the future might throw at you. Don’t waste time and make sure you are protected.