Financial education, making protection a ‘national priority,’ and keeping on with Keeping Britain Working should be prioritised by the UK’s new prime minister.
The long held goal of tax incentives to encourage take-up of health and protection insurance were also highlighted by advisers Health & Protection spoke to as Andy Burnham prepares to take office as Labour leader today and the UK’s new PM on Monday.
There was optimism that as a former health secretary Burnham would by sympathetic and understanding of the importance of the nation’s health provision and protection.
Tax relief
Alan Lakey, director of CIExpert and Highclere Financial Services, told Health & Protection tax relief should be a top priority for Burnham.
“Any lucid-thinking PM would understand that the provision of basic tax relief at source proved a huge incentive for pension contributions and a similar stance on income protection whereby tax relief is provided upfront and the benefits taxed would similarly boost the uptake of IP plans,” Lakey said.
“The NHS looks beyond repair so he should be thinking about how tax incentives could assist both this and PMI.”
However, acknowledging the long-term inaction in this regard from many governments, Lakey was not optimistic.
“I’m not holding my breath,” he added.
Three priorities
Dr Sheun Oke, managing partner and CEO of Emergenzz Financial Services, told Health & Protection there were three priorities for the new PM that could significantly strengthen the UK’s financial resilience.
“First, make financial protection a national priority by encouraging more families to take out life insurance, income protection and critical illness cover, so that an unexpected event doesn’t become a financial catastrophe,” Oke said.
“Second, embed financial education throughout our education system and communities.
“People make better financial decisions when they understand the importance of protecting their income, health and loved ones.
“Third, introduce meaningful tax incentives for protection products. Just as pensions are encouraged through tax relief, protecting families and businesses should also be recognised as an investment in the nation’s long-term economic wellbeing.
“I hope the new prime minister places financial protection at the heart of the UK’s long-term economic strategy, helping to create a more secure and prosperous future for everyone.”
Not a niche brief
For Isaac Feiner, managing director at Lifepoint Healthcare, health and protection should not be treated as a niche brief.
“It’s central to getting Britain’s workforce healthy and back to work, which is where this government’s growth ambitions will live or die,” Feiner maintained.
“Andy Burnham is well placed to see that, as a former health secretary whose own Greater Manchester is already a Keep Britain Working vanguard.
“The case for PMI is simple: it takes pressure off the NHS, gets people treated and back on their feet faster, and every insured procedure is one fewer on an NHS waiting list.
“On IPT, I’d urge realism over a wish-list, but taxing the very cover that keeps people working and off the NHS at 12% makes no sense, and that’s where he should start.”
Keeping on with Keeping Britain Working
Protection Distributors Group board member Roy McLoughlin told Health & Protection the new PM needs to carry on with Sir Charlie Mayfield’s work with Keep Britain Working.
“He should really ramp that up because that’s an incredibly positive piece of research where the IFA community has an integral part to play in the solution” McLoughlin said.
“It talks about early intervention services and vocational rehabilitation and you can’t buy that stuff directly, so I’d like to see that continue,.
“Also a greater focus on long-term care would be welcome because it’s not being talked about.”
Improving awareness
And for Jo Pawson, head of protection at New Leaf, Burnham and his government should work alongside the protection industry to improve awareness, simplify access to advice and encourage more people to protect their ability to earn an income.
“Better financial protection not only supports families when life takes an unexpected turn but will also help reduce longer-term pressure on the state,” Pawson said.
“Alongside this, embedding compulsory financial literacy in the school curriculum would equip future generations with the skills to make better financial decisions throughout their lives.
“Investing in prevention, education and protection today will create a more financially resilient nation tomorrow.”
