"People are now more aware of the vital importance of their income and the vulnerability of their finances."
The Covid-19 pandemic is encouraging people to consider taking out income protection insurance, according to research from LV=.
The findings show that 8.3m (48%) of 25-44 year olds with no IP cover have become interested in taking out income protection insurance to safeguard their earnings, while 40% with no life cover are considering life assurance.
7% of 25-44 year olds surveyed had acquired a protection product in the past three months. but nearly one in five (19%) without IP cover say they have never heard of income protection insurance, and 14% are unaware of life assurance.
The LV= Wealth and Wellbeing Monitor reveals that 25-44 year olds are more likely than older age groups to be struggling with the financial repercussions of the second coronavirus lockdown. Many are also pessimistic about the outlook for their finances.
44% of 25-44 year olds said their finances were worse than three months ago (compared to 36% of UK adults), with only 12% saying they were better.
Additionally, 30% of 25-44 year olds expect their finances to worsen over the next three months (compared to 26% of UK adults), while 14% expect it to improve.
Debbie Kennedy, protection director at LV=, said: “The pandemic, lockdowns and furlough has caused a huge amount of financial damage to millions of households who are worried about maintaining a steady income.
“The challenges of the coronavirus pandemic and further lockdowns have forced people to re-evaluate their priorities and spending habits to tackle short-term instability. People are now more aware of the vital importance of their income and the vulnerability of their finances. It is encouraging to see more people interested in protecting their income, and how this is becoming more important than traditional life insurance for younger people.
“As a leading income protection provider, LV= continues to promote the importance of protecting income through our own efforts, through collective action with the Income Protection Task Force and by supporting financial advisers.
“We should be educating the wider public as an industry about protecting income and the added benefits included when taking out a protection policy, going the extra mile to provide financial and emotional support to those that need it.”