Will your family suffer if you die?

Only 7 per cent of people in the UK who support someone financially have spoken with an adviser about long-term financial protection, according to research.  The findings were a part of a global study by HSBC which quizzed more than 13,000 people across 13 countries to look at levels of financial security.

The analysis found 27 per cent of UK respondents supporting someone financially have never had a conversation about long-term financial security should something happen to them – not even with friends and family.  This compared to 22 per cent globally.

But unexpected life events can have knock-on financial consequences for the whole family and 81 per cent of people in the UK said their family would not manage well if they had to significantly reduce their support to them. 

Based on the research findings, HSBC has now identified four actions which can help people better prepare their family.  This includes 1) identify your priorities, 2) assess your finances, 3) plan for the whole family and 4) discuss what the family’s needs are for the future.

The figures from this research are frightening.  Many people seem to be lacking even a basic level of financial protection whilst at the same time are seemingly happy to spend hundreds of pounds a year on what some might be deem to be luxuries, such as, mobile phones and satellite TV.  People try not to think about the possibility of serious ill-health or early death, or tend to think that these things only happen to ‘other people’, but that’s simply not true.

Something chronic

I heard a story recently which I thought was worth sharing.  A young woman had just returned from a mini-break in Tenerife. Twenty girls on a hen weekend, so you can imagine there was a fair bit of eating, drinking and dancing.

I’m told they also did a water park, a boat trip and paddle boarding and after all it’s all about the balance!  There were a few people she hadn’t met before and it transpired one of the girls had type 1 diabetes. The story teller didn’t realise this until the last day because her friend had totally blended into the group, took part in all the activities and didn’t feel different to anyone else..

It was the first time she’d met someone with diabetes – as far as I’m aware anyway – which is surprising when you consider 3.5 million people in the UK have been diagnosed.

They, generally speaking, consider themselves to be normal so why are they so underserved when it comes to accessing financial products like life insurance?

Securing life cover for people who have been diagnosed with a chronic condition can involve detailed medical questionnaires, followed by exclusions, additional premiums or being declined cover. It’s no wonder people have been put off.

We’ve recently seen more innovation in this area with life cover tailor-made for people with type 1 or type 2 diabetes.  So hopefully the situation is changing.

If this story strikes a chord with anyone, maybe we can help.