UK renters risk being thrown out on their ear by landlords should they get sick, as just under a third (29%) admit that they would struggle to pay next months’ rent if they were unable to work due to illness, according to new findings from LifeSearch, the independent UK protection advice specialist. Only 14% of renters think they could manage to still pay their rent for more than three months if they were unable to work.
The research, which surveyed 1,000 renters in the UK, found that their lack of preparedness for a major financial shock is stark. The research found that just over a quarter (28%) of UK renters say their finances could cope with being signed off work sick for a long period of time. Just under a quarter (22%) said they could cope with being diagnosed with a serious illness, while only 14% said they’d be able to cope financially with having a loved one fall seriously ill.
When observing how renters would mitigate such a shock to their income, the steps people would rely upon are borrowing money from family members (36%), dipping into their cash savings (excluding any ‘rainy day/ emergency pot) (35%), or dipping into their ‘rainy day’ / emergency pots (33%). Just under one in five (18%) say they would liquidise their investments. Worryingly, more people would opt for borrowing money from a short-term finance provider (6%) than are able to claim on an insurance or protection policy (4%).
Ed Axon, Chief Growth Officer at LifeSearch comments: “With a broader cross-section of the population renting a property for a home, protecting the rights of renters has received significant attention, especially in recent months as rental prices have surged. However, while this is undoubtedly important, the financial knife-edge on which many renters are living has gone under the radar.”
“The security and peace of mind offered by an insurance protection policy can be transformative. But that so few renters know about, or take advantage of this option is a real worry. This is a challenge that must be met head-on. Education is key, but the ‘where’ is just as important to success as the ‘what’. It’s essential that we turn up where renters are, on channels they prefer, with products and experiences designed around them.
Drawing on my experience in the fintech sector here and in the US, I’m greatly encouraged that LifeSearch is collaborating with innovative and trusted partners to invent something designed around renters. Insurance – and income protection of sorts, but not as we know it – can be a good thing. We’re set to help build renters’ resilience with something easily accessible, attractive – importantly – affordable.
