Just 33% of UK over-50s have life insurance during COVID
According to research from OneFamily, a financial services provider based in Sussex, only 33% of respondents had life insurance cover, and 28% of over 50’s surveyed said they had no interest in engaging with end-of-life planning.
Other, data-specific questions show that with the complications wrought by COVID-19, life cover had become a less considered priority.
While this was the overall figure, certain areas were more likely to have cover than others. Scotland scored highest, with 47% of over 50’s with life insurance, while Northern Ireland came in at 46%. Wales scored 37% and London, just 28%, while the West Midlands was the lowest at 26%.
Life insurance factors
Despite these varying levels of coverage, the data shows that three in 10 over-50s have prioritised life insurance cover, with the largest number of that demographic still having a mortgage to pay off. This indicates that still having costs to pay on a home is a key factor in the decision to take out cover.
The report went on to state that a high level of those covered (one in five) did not know if their insurance would cover them for problems caused by COVID-19. A further 13% questioned said that policies were too expensive, while 14% stated that they would cancel their cover if their finances were put under further strain.
Age is also considered a barrier to taking our cover, with 18% of respondents under the impression that if they were over 50, they were ‘too old’ to apply for life insurance. Many (52%) also said they would prefer to put their cash into savings plans than take out cover.
However, despite these findings, a recent study by Capgemini found that technology has increased customer engagement with life insurance products. The fact that users are more comfortable with real-time data being shared, and apps and IoT devices can help reduce premiums as they incentivise a healthier lifestyle, has been helpful in increasing the number of people taking out cover.
Those who do take out cover have greater peace of mind, with 40% of those with active policies saying they consider covering the costs of their funerals an important matter. Life insurers are also developing more innovative and experience-centric products, which is appealing to a younger generation, the Capgemini survey found.
Speaking about the study findings, Paul Bridgwater from OneFamily explained, “Our research suggests that only one in three people had life insurance in place over the last year and this could be because they find it hard to face up to their worst fears.
“But, as we’ve found, those who have got cover in place were actually strongly motivated by the need to gain peace of mind. They were reassured to know that, should the worst happen, the funeral costs would be covered and their family protected.
“Talking about what happens after a customer dies is always going to be a little uncomfortable for them and will need careful handling by a skilled adviser.”
Bridgewater added, “However, knowing about the other potential barriers – such as a lack of understanding over product cover, age requirements, the need for a medical or concerns over cost – could help advisers in opening up the conversation and finding the right solution for their client.”