Why is insurance important for young adults?
It’s estimated that a growing number of young adults don’t have insurance, so why is it important that young people become insured? We look at the problems that can occur when people don’t have the right level of protection in place.
Being uninsured could leave you unprotected
Last year a recent survey found that around 28% of young adults with a mortgage didn’t have any form of cover. It’s been estimated that 1.7 million UK homeowners are at risk of leaving their families ones unprotected in the event of their death. In fact, around half (51%) of those aged 18 – 40 said they did not have life cover due to affordability issues.
According to a recent study, only 52% of workers in the UK have adequate insurance. The average household debt is £20,640 (excluding mortgages), which rises to £28,908 for self-employed workers. It’s estimated that an average worker has three people who are dependent on their income. However, only 7% have an insurance policy in place.
Worryingly, 42% of households in the UK reported they would only survive for up to three months without an income. When asked how they would cope, 47% of surveyed workers advised that if they couldn’t work for two months or more, they would use their savings.
However, with the right income protection insurance in place, you wouldn’t need to drain your savings pot or put your partner under unnecessary financial strain. Instead, your insurer would pay out a monthly sum until the term ends or you return to work.
Would you have enough savings to cover the cost of household bills and other daily living costs if you fell ill? Would your partner be able to pay your mortgage and look after your family if you were to lose your life?
Find the right insurance policy
An insurance policy can provide protection for you or your family if the worst happened and you fell ill or lost your life. The death of a main earner is estimated to cost their surviving family an average of £195,000 over 10 years. But this figure would only cover basic costs, while the true cost to a bereaved family or surviving partner is likely to be much more.
When it comes to insurance, policies and providers do vary, so it’s important to find suitable cover for your situation. It’s also worth noting that if a provider spots an error in your insurance application, they might not pay out in an emergency. A failed insurance claim could result in you losing your home.
At Bubble Finance Hub, our experienced insurance advisers can find the right policy for your needs. We can advise on life insurance, critical illness, income protection and other policies. We always aim to find a suitable level of cover for our clients at an affordable cost.
If you’re a young adult without insurance or you would like us to check a policy, please get in touch to book an appointment.
As with all insurance policies, conditions and exclusions will apply.
Your home may be repossessed if you do not keep up repayments on your mortgage
Thank you for reading our blog, Why is insurance important for young adults?.
Bubble Finance Hub
Sources:
Beagle Street
LV