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Consumers in the dark over financial protection

  • MetLife UK warns that UK adults could be missing out on crucial financial protection as many are left in the dark over which products are available
  • Despite not fully understanding the range of financial protection products available, one in six (16%) admit they have previously needed a policy
  • 73% of workers worry about having to take time off work due to illness and/or injury, of which 30% worry more than they previously did pre-pandemic

UK adults admit they don’t fully understand various financial protection products including income protection, critical illness cover and family income benefit, according to new research from MetLife UK. The company warns that many could be missing out on vital financial protection as many are left in the dark as to what products are available.

The research, which explores consumer views of financial protection in a Covid-19 world, found almost one in five had never heard of income protection, whilst one in six (17%) have never heard of mortgage payment cover protection, and almost the same number (16%) don’t know what critical illness cover is. Although some UK adults say they’ve heard of such financial protection products, many admit that they still don’t understand what the respective product actually covers. Almost one in five (18%) say that they’ve heard of critical illness cover, but they don’t understand what it covers, whilst almost the same number (20%) say the same about income protection.

Product Heard of it, but doesn’t understand what it covers I’ve never heard of it
Critical Illness Cover 18% 16%
Health Insurance 14% 9%
Accident Insurance 17% 12%
Income Protection 20% 19%
Mortgage Payment Cover Protection 16% 17%
Life Insurance 12% 7%
Funeral Benefit Plan 16% 16%
Family Income Benefit 25% 34%

 

The study found that although may consumers don’t fully understand what financial products are available or cover, one in six (16%) admitted that they have previously needed such a policy, however, didn’t have anything in place.

The study also found that 73% of workers worry about having to take time off work due to illness and/or injury since the pandemic started, of which 30% worry more than they previously did.

A quarter (25%) of consumers say their job comes with an associated risk of injury.  Further research from MetLife UK found that more than a third (34%) say they’ve had to take four weeks or more off work due to an accident or illness. Of which, nearly half (47%) admitted they needed financial support to help them with their mortgage repayments. Which 15% said they regretted not taking out a policy to help them get through the difficult times.

Rich Horner, Head of Individual Protection at MetLife, comments: “Financial protection products are often overlooked as a non-tangible product that you won’t ever need. Because let’s face it, no one wants to think about falling ill, having an accident, passing away and so on. But unfortunately, the reality is that the unexpected can and does happen.  The issue for consumers is two-fold. Not understanding what is available and what it covers, and associated costs. By having the right financial protection in place, it can help alleviate some of the stress and worry that not having anything in place often brings.

“As a provider, we all have a role to play to help consumers understand what products are on the market and importantly, what it covers. Often there are misconceptions that products are expensive and then when needed do not pay out but that’s simply not true. I’d urge consumers to see what is out there and get in touch with providers or their financial adviser to ask any questions. This can help them better understand how to protect what is most important to them via valuable insurance policies and help to put plans in place for the future.”

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