General Insurance Article - A working mothers day is full enough but needs protecting

Ahead of Mother’s Day Aegon UK has conducted research into the average UK mum’s level of income protection, amount of savings and reliance on a partner’s income. The results paint a potentially alarming picture: a significant number of mums do not have adequate protection or savings and often rely on a partner’s income to provide for the household.

 Worryingly, nearly one in six (15%) of the mums surveyed responded that they have no savings at all. Additionally, with 52% relying on two incomes to support the household day to day, this raises questions around UK families’ ability to get by if an income is unexpectedly lost for a period of time. 

 Key Research Findings

 Mum’s protection levels:
 43% of mum’s have no protection policy in place:
 53% say they can’t afford it, 18% don’t view protection cover as a priority and 16% don’t see the value of protection insurance
 Yet, 42% of mums believe it is solely their responsibility to provide for the household should anything happen to them and they be unable to work
 40% are the main breadwinner for the family
 52% of households rely on two incomes to meet the day to day expenses of everyday life and other essentials

 What happens if mums are unable to work and provide an income?
 If mums were unable to work for six months or more:
 40% of mums would rely on their savings
 Yet, 15% of mums have absolutely no savings at all, 4% say they would only have enough to last 4 weeks and 19% would only have enough to last up three months
 38% would rely on their partners income
 21% would rely on the state or government for support
 17% would have to make major budget decisions

 Women with children in paid childcare?
 If a mum was to unexpectedly pass away or become critically ill with a child in paid childcare:
 45% believe their partners income would cover it, 40% say family could help out and 23% would use their savings
 However, 22% say their partner would have to reduce their hours in order to car for their children, placing additional pressure on the family finances and 16% assume they would be supporting by the government.

 Getting help?
 Over three fifths (63%) of mums have never spoken to a financial adviser about protection cover

 Stephen Crosbie, Protection Director at Aegon said: “Despite the welcome addition of an extra 15 hours of childcare for three and four year olds in the Budget, childcare costs have become an increasing financial strain on families in the UK. A strain that is only aggravated in the event of a parent falling seriously ill and being unable to work or care for their children. Childcare naturally plays such a vital role in people’s lives and families should make sure it is covered within their protection plans.
 “Our own research recently found that the 16% of mothers assumed that the Government would help them pay for childcare if they were unable to work, but this is not the case for many families. The Government only provides help for childcare costs to the poorest parents through Working Tax Credit – and there’s a cap on how much money it is possible to access, which is unlikely to be enough to meet the costs reported by the Family and Childcare Trust. Government support is there to act as a financial safety net but it’s unlikely to provide a comfortable standard of living.
 “Should parents be unable to work or care for their children due to serious illness, they could benefit from having protection policies such as income protection or critical illness cover in place cover to help cover the costs of continued childcare. For those who already have protection in place, I would encourage them to review the amount they are covered for to ensure the inflation of childcare costs and living expenses over the years has been accounted for in their plans.”

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