UK workers are significantly overestimating the level of financial support they would receive if they were unable to work due to illness or injury, according to new research from Vitality. The findings highlight a potential advice opportunity for protection advisers.
The research found that two-thirds (64%) of employees say they know what sick pay they would receive if they were unable to work due to illness or injury, expecting, on average, around 12 weeks at full pay. More than a quarter (26%) expected 12 to 24 weeks at full pay.
Given that a recent government survey has indicated only 37% of employers provide sick pay above Statutory Sick Pay (SSP), this highlights a potential mismatch between employee expectations of extended full‑pay cover and the more limited provision many employers offer.
Concerningly, a third (36%) of people admitted they either don’t know or are unsure what their company’s sick pay policy is, and more than a third of adults (37%) said they would not feel confident financially if their household income stopped unexpectedly.
Despite this concern, only one in ten (10%) respondents said they currently hold an income protection policy, highlighting a potentially significant financial vulnerability should they be unable to work for a period of time due to illness.
When workers were asked how they would cover their outgoings if sick and unable to work, only 7% of respondents said they would rely on an income protection product. Instead, most expect to fall back on savings (62%), while one in five (20%) would turn to credit cards and almost one in ten (9%) to short-term loans.
Andy Philo, Director of Strategic Partnerships at Vitality, said: “The data tells a story most people haven’t had reason to think about yet. Many assume their sick pay will carry them through a period of illness, and that only tends to become real when something goes wrong and when the choices available have already narrowed.
The conversations worth having are the ones that happen earlier, when people are well and have the time and headspace to understand what they actually have in place. That’s where real value comes from. People who engage with their cover regularly are in a far stronger position, financially and mentally, when they need it most.
It’s something we think about a lot at Vitality. Helping people stay connected to their cover while they’re healthy, not just when they’re making a claim.
