It is well know that there is a large protection gap in the United Kingdom. Many individuals simply aren’t taking out protection insurances, such as life insurance and mortgage protection, to provide themselves with adequate financial protection from life’s uncertainties. New research from the UK-based insurer, Axa, shows that a lack of cover taken out by women contributes to a large proportion of the protection gap.
Women as financial providers
Over the last 30 years the role of women in society has changes considerably. Gone are the days of women staying at home while their husband goes out to work each day, with Axa stating that female employment has risen by nearly 18% over the past 30 years. In this day and age women now contribute a very significant proportion to total household income. Although this is very positive for the economy and for household income, the issue is that women are not acquiring the same level of insurance protection to reflect their significance to household wealth.
Women under protected
The research shows that only 38% of women hold life insurance and even less, 18%, hold critical illness cover. These figures are particularly concerning with the survey also showing that between 27% of women with dependent children have sole financial responsibility for paying the mortgage and 30% for paying household bills. Axa also states predictions suggesting that by 2030 women will be the main financial provider in about 25% of households.
All the evidence from Axa suggests that women are significantly under-protected. Households face a huge financial risk if the income of either partner is lost and this is particularly acute if the couple have children. Naturally, single parents need to take financial protection extremely seriously as the loss of their income could be catastrophic for the future of their children.
The most common types of cover to consider include life insurance, mortgage life cover, mortgage payment protection (which includes unemployment insurance) and income protection. Critical illness cover is another type of policy worth considering, which can be attached to life cover and would payout a lump-sum should the policyholder suffer a serious illness.
More information and analysis regarding this research can be found on ifaonline.co.uk.