Barclays warns of protection gap threat

Tuesday, 25 November 2008 12:00

Nearly half of all UK adults have no policies in place to protect themselves in the event of illness or redundancy.

A survey from Barclays found 47 per cent of UK adults have no protection from a financial catastrophe, with 52 per cent having no life insurance, 75 per cent admitting to not having critical illness cover and 78 per cent having no income protection cover.

Alison Tattersall, head of customer and proposition at Barclays Financial Planning, said: "When finances are tight it is often responsibilities like protection policies that fall to a lower priority, and of course these policies protect outcomes that people don't want to think about.

"But people must consider the financial consequences of what would happen if they were unable to work, or their dependents' situation if they died, it would be far worse than any concerns they currently have over struggling to meet their outgoings."

Worryingly, people do not appear to have a Plan B, Barclays said.

Research reveals 60 per cent of people admit to having nothing saved, having less than one month's salary in the bank, or not knowing what they have in savings at all.

In addition, nearly 40 per cent of people do not receive benefits such as sick pay, death in service or health insurance, or simply do not know if they would be entitled to them.

David Stuart, director of investment advice & products at Barclays Financial Planning offers top tips for covering your protection needs.

Regionally, the south is less protection savvy than the north, but those in Wales have the least protection overall, Barclays said.

The north-east is the best protected region with 62 per cent having protection cover in place, while the south-east has 48 per cent of people without protection cover, with London at 53 per cent with no protection.

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