The definition of financial resilience is the ability to cope with a sudden unexpected change to finances, such as a temporary loss of income. Essentially, it’s about whether bills can continue to be paid, food put on the table and loved ones supported. In today’s climate consumers are even more aware of their need to be financially resilient, but do they realise protection could provide that solution? Our second Reaching Resilience report* explores the views of UK working adults on their financial resilience and challenges their perception of what makes a good plan B if they couldn’t work because of illness or injury. Here are three key takeaways from the report that you can use within your protection conversations: Almost half of the working population said they’d rely on savings This is a common objection to protection that I think most of us can relate to. Almost half of workers surveyed said they would rely on savings if an illness or injury left them unable to work. Yet our research showed that 4 in 10 workers don’t have the suggested 3 months of average outgoings saved (around £5,000 for the average household**). Exploring this further: • Around 4 in 10 have less than £5,000 saved • A quarter have less than £1,000 • 1 in 10 have no savings at all This isn’t a sustainable safety net for most people, especially when you consider, according to LV= claims data from 2023, the average LV= Income Protection claim lasted for 5 years, 2 months. Sharing this with your client can get them to think about how far their savings would get them. Unless specifically an emergency fund, it’s also unlikely your client’s original saving goal was to cover outgoings due to an unexpected life event. How prepared are your clients to dip into these hard-earned savings? Plenty think they could rely on others to get by Another common theme was the assumption that they could rely on a partner, parent, or other family members to cover this loss in income. However, when we asked ‘who else relies on your income’ the most common response was their partner, and 52% of working couples said they need both incomes to meet their outgoings. This statistic is even higher for younger working couples and first-time buyers. In fact, according to our research the average worker is supporting 3 people with Carl Heard National Account Manager LV= 12 SPRING PROTECT NEWSLETTER How prepared is your client for the unexpected?
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