Of those, 1 in 12 admits they don’t know how much they are covered for.
According to an AA/Populus study amongst AA customers, the gap in life protection is most evident in 35-44 year olds who are the most likely to have both children under 18 (60%) and a mortgage (59%). Although they have the greatest need, only 43% of this age group have life insurance.
Life Insurance can provide protection at any age; people in their forties and fifties are the most likely to have cover – but that’s just 57% of them.
Mark Huggins, Director of AA Financial Services comments:
“Life insurance is generally taken out to cover an outstanding mortgage or to leave a lump sum behind for family to help pay bills in the future.
“It’s life-changing events such as having children or buying a house that lead people to think about making provisions in case they’re no longer around.”
But Mr Huggins points out that the take up from those at such life stages is still lower than might be expected.
“Taking out life insurance may not be front of mind for people who have a new strain on their finances such as a house or a baby. But if you’re young and healthy, life insurance can cost just a few pounds a month.”
He also goes on to point out that life insurance can be useful for those left behind: “A lump sum life insurance payment to your dependents can be used for any purpose which could include covering a funeral or an inheritance tax bill. Those who wish to pass on an inheritance in excess of £325,000 will have to pay inheritance tax amounting to 40% of their estate over that threshold.
“But whatever your age, life insurance can be a vital lifeline to your family if you’re no longer around.”
