As the nation celebrates Father’s Day this Sunday, peace of mind may not be the obvious gift choice, but it’s clear that financial protection is something which millions of fathers in the UK, and their families, could benefit from.
Research from Scottish Widows reveals that more than half (58%) of men in the UK with dependent children have no life insurance, meaning that just over 4.5 million dads are leaving their families in a precarious situation if the unforeseen were to happen. Worryingly, this has increased by five percentage points compared with 2017, a year-on-year increase of around 542,000 individuals.
And despite a fifth (20%) of dads admitting their household wouldn’t survive financially if they lost their income due to long-term illness, only 18% have a critical illness policy, leaving many more millions at risk of financial hardship if they were to become seriously ill.
If they were unable to work due to serious illness, 16% of fathers say they could only pay their household bills for a minimum of three months. More than two-fifths (45%) say they’d have to dip into their savings to manage financially, but 17% admit that their savings would last for a maximum of just three months and 12% say they have no savings at all.
On top of this, many fathers are leaving themselves and their families unprepared for other aspects of illness or bereavement. Sixteen per cent of them aren’t sure who would take care of them if they fell ill, and more than two fifths (42%) don’t have the protection of a will, power of attorney, guardianship or trust arrangement in place for their families.
This is an especially risky position for the two thirds (66%) of UK fathers who are the main breadwinner in the family, and it’s clear that many are in lack of a ‘Plan B’.
Gary Burchett, protection director at Scottish Widows, says: “Many fathers don’t consider having insurance as a necessity, with 16% of those without saying they don’t see critical illness cover as a financial priority, and 20% saying they don’t think they need it. The value of protection, however, is to provide long-term peace of mind about having financial security in place for your dependents.
“Recent changes to bereavement benefits, and their continued unavailability to those in cohabiting relationships, mean that it’s more important than ever for fathers to review their financial protection needs and seek advice to make sure their household is covered.”
Scottish Widows paid out 98.99% of life claims and 93.06% of critical illness claims in 2017. The number of claims paid for life cover was 7,469 and for critical illness it was 1,769, equating to a total of 9,238 individuals and their families being helped to manage the financial and emotional impact of critical illness or death.