Health and wealth challenges of the UK population – our latest research

Health and wealth challenges of the UK population – our latest research
Health and wealth challenges of the UK population – our latest research

Jamie Page


Head of Protection Distribution

2022 was meant to be a year of recovery, resilience and returning to normality. After a difficult few years people had high hopes for businesses to bounce back and communities to come together again. 

Long-awaited holidays would go ahead with no restrictions, and the effects of the pandemic would be a distant memory. However, as we know from all the headlines, it hasn’t gone quite as planned. We’ve seen record NHS waiting times, inflation at its highest rate in 40 years, interest rate at its highest in 13 years, different industries striking because of poor pay and underfunding, energy price hikes, and don’t even get me started on the price of a well-known butter brand!

We wanted to further understand how this impacted the average UK household and what consumers’ views and concerns were. We surveyed 2,000 employed and 2,000 self-employed adults about their health and financial fears. The results showed some clear trends and interesting insights.

Changing spending habits

Our research found that 81% of the working population have changed their spending habits because of increases in energy prices, inflation, and National Insurance. While it’s not a huge surprise that people have had to cut back, I was more shocked to see the amount of people that had been affected. This shows current issues don’t just affect a small minority, but in fact most of the UK population.

We’re not just talking the odd social occasion that’s being cut back on either. Almost half (49%) said they now spend less on their weekly shopping by buying fewer or cheaper options, while 44% have reduced their utility usage, and 41% are spending less on leisure and entertainment. Some significant changes by a significant amount of people. And sadly, 44% are worried about keeping up with rent or mortgage repayments.

If 81% are concerned now about their spending habits and having to cut back, what would they do if they had an accident or became unwell resulting in being off work and having no means of regular income. It could be catastrophic to their outgoings and the safeguarding of their future finances, not to mention the mental and physical toll that can take on someone.

Affordability and beyond

So why, when there’s such a positive solution to help address the problem, is there still such a protection gap in the UK? The top reason consumers gave for not taking protection was affordability. Given the issues we’ve discussed already around the cost of living, this was to be expected. But actually, protection can be very affordable. By making the most of the different premium options available and considering both short and long term claim periods, you can put together a solution that suits your clients’ needs and budget. In fact, the average cost of an income protection policy with a two year claim period in 2021 was just £24 per month. *

Beyond affordability, our research highlighted a need for wider conversations. With 16% of respondents having “not got around” to applying for insurance and 9% wanting to know more but not knowing where to start, this could be viewed as a missed opportunity.

Quality VS. Cost

Although price was the main barrier, this isn’t the only consideration. 99% of UK adults rate the quality of a product as equally important as affordability. This shows we need to consider how we position protection products to focus on quality over cost. Many products have increased flexibility to meet a range of budgets, but these are meaningless if people are not open to discussing products based purely on price. We need to consider what more we can do to challenge the consumer mindset and make products a "must have".

Good news on the value of advice

96% want the right advice to help inform their purchase. When it comes to protection, ensuring people can seek advice to make the right choices is hugely important. It’s promising to see consumers recognising the value of advice and we need to make the most of this heightened awareness. Helping your clients understand their needs, discussing potential solutions, drawing up short lists, and highlighting pros and cons are all things they may not receive if they tried to get insurance directly. And we think that’s something to shout about.

You matter more

We all have a big role to play when it comes to addressing consumers’ concerns. For advisers there’s an opportunity to use the heightened awareness that customers have, to give reassurance that through the value of your advice you can protect them, their families, and their lifestyles. You can use our research and the current circumstances to give very real and personal examples to your existing clients and any new potential clients.

We need to continue working with the rest of the industry to drive greater awareness and better understand what we need to do to support your client conversations. And this research is just the first step. Over the coming months we’ll be taking a deeper dive into the research data, looking at the opportunities this information presents, and the solutions we have to help you, your clients and our members.

Read our full research report to gain 30 minutes CPD.

* Source: The Exeter, Challenging times: The health and financial fears of UK workers, *Swiss Re, Term & Health Watch 2022