Only 26% of renters have life insurance or critical illness cover, in comparison to 41% of homeowners, according to a new study from Sainsbury’s Bank.
In the past 10 years, the number of households renting privately with children has risen by almost 800,000 to nearly 1.6 million. Renters are being urged to consider what their partner or family would do if they unexpectedly needed to cover housing costs such as rent and factoring contributions and other monthly out goings if the unthinkable was to happen.
Despite being less likely to have life insurance or critical illness cover, 54% of renters are more concerned than homeowners (48%) about the financial implications should they pass away before old age. Also 21% of renters living in private accommodation worry about this situation on a weekly basis compared to 16% of homeowners.
The survey found the top reason renters do not have life insurance is they believe they don’t have enough equity or money to have a life insurance policy (29%), in comparison to homeowners (11%).
Important life events are the top reasons people decide to financially protect themselves. Buying a house is the main reason people chose to purchase life insurance (34%), followed by other other life stages, such as having a child (17%) and getting married (12%). Unfortunate experiences, such as becoming ill (9%) also prompt people to take out a policy.
Karen Hogg, head of insurance at Sainsbury’s Bank, said: “As more people are raising families in rented accommodation, we need to shift our thinking in terms of life and critical illness cover only being relevant for people with a mortgage. That’s just not the case. All people need to consider what protection their partner and children may need should anything happen to them, including how to cover rent, bills and household essentials.
“Our research found that people are more likely to worry about the financial implications of their passing rather than taking action to alleviate any concerns and protect themselves for the future. Taking out a life insurance policy can help give you peace of mind and ensures you have the financial protection in place.”
Sainsbury’s Bank Life Insurance, provided by Legal and General, offers a range of protection including Life Insurance and Critical Illness Cover. New life insurance customers are offered double Nectar points on Sainsbury’s shopping and fuel, when buying a new Life Insurance policy either with or without Critical Illness cover.