15 November 2017
Insuring Women's Futures
Whilst the UK’s gender pay gap is increasingly and rightly attracting media attention, recent ONS gender employment data, makes for interesting reading.
The data highlights that the employment levels of women have been steadily increasing since 2012, with over 70% of working age women now in employment. And there are also now more than 4.9m mothers in the UK workforce.
But, this begs the question, given this level of employment: why is the UK financial protection gender gap not closing?
Especially since we are in the midst of significant reform to working age welfare and a social care crisis, both of which have a disproportionate impact on women.
We know that many women underestimate the financial value of their role, and therefore the need for protection. With 81% of women placing importance on insuring their possessions, but just 33% saying the same about their lives and health.
This underestimation of their value can result in women placing their family financial resilience at risk as:
- 76% of women say their families would struggle with everyday activities and household expenses if they became seriously ill or passed away
- Despite saying that their households could only pay the bills for 7 months should they pass away or not be able to work, only 31% of women have life insurance and just 7% have critical illness cover in place.
This lack of provision can leave many families in a vulnerable position.
When asked how they’d cope, should they or their partner not be able to work for six months, 25% of women said they’d rely only on state benefits. And 54% don’t have the protection of a will or guardianship arrangement in place for their families.
In addition, fewer women than men think their household could survive on one income if their partner died or was unable to work. Just over 51% say their family could live on one income, compared with 65% of men.
But following welfare reform, a new Bereavement Support Payment benefit is now in place, which may result in a significant reduction to the period over which State support will be available. And co-habiting families, of which there are 3.3 million in the UK, still do not qualify for bereavement benefits under the new payment.
So what does this mean for you and your clients? Clearly, it is more important than ever for women to review their financial protection needs, to ensure they have appropriate cover in place.
And if you have clients who are in a cohabiting relationship and are taking out, or already have financial protection, you should ensure that it’s set up correctly. So that, should the worst happen, the right monies go to the right people as quickly and tax-efficiently as possible.
Scottish Widows support the aims and objectives of the Chartered Insurance Institute’s (CII) Insuring Women’s Future Programme at www.insuringwomensfutures.co.uk and further detail on working age welfare and bereavement benefit reform can be found at www.turn2us.org.uk.
Sources: Office for National Statistics, The Labour Force Survey
Scottish Widows’ protection research is based on a survey carried out online by Opinium, who interviewed a total of 5,077 adults in the UK between 16th and 27th March 2017.