Nine in 10 do not have income protection, says the Cost of Resilience Report
According to research by Zurich, more than half of UK adults (53%) have had to take unplanned leave from work through injury, sickness or unemployment, yet do not have financial backing in case it happens again.
The Cost of Resilience report, a survey of 2059 adults, also found that it is likely that one in eight (13%) would have to sell their family home because of sickness or injury, while over a quarter (26%) would have to sell their possessions and one in seven (14%) would have to find a cheaper place to rent.
Around a third (34%) do not feel financially resilient and said they would not be able to manage a financial shock or unexpected loss of income by themselves.
Out of work
According to YouGov, approximately 131 million working days were lost due to sickness or injury in the UK last year, and more than two in five (45%) UK adults have been out of work for up to a year, while one in 10 (10%) have been off for longer than 12 months.
The study also found that nine in 10 (92%) do not have income protection, while one in six (17%) have no disposable income and a quarter (24%) have no savings to fall back on.
“It’s concerning that so many people have experienced unexpected time out of work, yet have no safety net in place for this potentially happening again. Even more shocking is the number who would have to resort to selling their home, as this action could have a significant impact on the whole family,” said Rose St Louis of Zurich UK.
“Lack of savings and planning the family finances is putting millions of adults at risk of not being financially resilient, but not taking action could make the situation far worse. Putting the ‘it won’t happen to me’ view to one side, it’s vital that people review their circumstances, to see what support exists to protect their finances and lifestyle.”
The Cost of Resilience report, examining the impact of financial products on people, has been developed by Zurich alongside neuroscientist, Dr. Jack Lewis.
“The findings demonstrate the very real impact that a period of being unable to work can have,” he said. “We have a tendency to prefer items that we can enjoy immediately over and above valuable things that we have to wait for, even when the latter adds greater value to our lives overall.
“A financial product that pays your salary when you are too ill to work is a strange and perhaps counter-intuitive concept,” continued Dr. Lewis. “So, we need to educate people to help them understand that such support exists; products that ease the stress and anxiety stemming from the threat of an unanticipated loss of income.”