Awareness of the importance of protection has risen since the pandemic and led many to reassess their financial and personal priorities. It’s sensible to review your protection cover once a year and to discuss it with those close to you to make sure it still meets your needs.
Have the conversation
Only half (52%) of unmarried adults who are in a relationship know whether their partner has a life insurance policy and more than a quarter (27%) of those who do know are unaware of the policy’s value1.
Many people assume they will automatically be entitled to the life insurance payout in the event of their partner’s death. This may not necessarily be the case. So, consider whether the policy should be put in trust to ensure the proceeds go where you want them to.
Prepare for financial shocks
How would you cope if you became ill? Would you have to rely on your partner, or struggle on trying to work? Almost one in five (19%) working adults say they would have to rely on their partner’s income or savings if they were unable to work, with 19% struggling to pay their mortgage or rent if they were unable to work for two months due to illness or injury. Some 11% would resort to taking on debt such as a loan, overdraft, or credit cards2.
It makes sense to review your situation carefully if you’re self-employed too. Only 6% of self-employed workers have an income protection policy and millions of self-employed people consider they would have to carry on working if they suffered an illness or injury.
1Scottish Widows, 2023