penniless in less than a month if their income ceased, warns Axa
Life, a UK unit of French insurer Axa.
This is despite the UK having the highest
life insurance penetration level in the world: 15.28 percent of GDP
in 2007, according to Swiss Re.
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From a protection perspective, a survey
undertaken for Axa Life by research firm Onepoll revealed that 45
percent of the UK’s adult population has not purchased any form of
protection cover, including life insurance, critical illness or
income protection. In addition only a third believe they have any
sort of financial provision in place to cover their home
mortgage.
Of the same survey respondents 49 percent
reported having less than £1,000 ($1,450) in savings and
investments, with 72 percent saving less than £100 a month and half
of these saving nothing for the longer term.
To draw its conclusion that half the
population is at serious risk should their incomes cease, Axa Life
compared the survey’s findings with data from the UK’s Office for
National Statistics – revealing that average household expenditure
is about £450 a month based on 2007 levels.
Also of concern, noted Axa Life, was that
about half of the respondents had no idea what critical illness and
income protection cover can offer them.
Given the current economic climate, the
situation is unlikely to change at present. Axa Life noted that
only 10 percent of respondents are prepared to commit to income
protection cover, 5 percent to critical illness and 7 percent to
life insurance.
