The UK’s cost of living crisis has caused one in 10 UK adults to think about cutting back on their protection policies.
This is according to a survey of more than 4,000 adults carried out by Opinium between 25 February and 1 March 2022 and commissioned by Royal London.
The survey found with inflation hitting levels not seen in 30 years, 95% of UK adults surveyed were concerned about the rising cost of living and one in ten (11%) are contemplating cutting back on their protection policies .
Two-thirds (66%) plan to change their food shopping habits, almost half (46%) will try to manage their energy bills by reducing the time their central heating is on and nearly a fifth (17%) say they will turn off heating completely.
Around two-thirds (63%) of people are planning to re-jig their finances, with 31% paying less into their savings, and 11% reducing their protection premiums or stopping them altogether.
Gregor Sked, protection development and technical manager at Royal London, said: “Rising energy bills and inflation levels not seen for three decades have massively impacted people’s everyday living costs and on top of that people will see a reduction in their take home pay as a result of National Insurance hikes. And as life gets more expensive, people are having to make difficult choices about their monthly outgoings. The danger is that they compromise their future financial resilience and make a decision about their protection insurance that they may regret further down the line.
“It’s a challenge that many advisers are facing as clients look for ways to cut down their monthly expenditure.
“After all, protection insurance isn’t tangible, and they’ve possibly forgotten the compelling reasons that persuaded them to take it out in the first place. However, there are a number of angles that are worth discussing with clients thinking about cancelling their cover.”