42% of UK adults worry their household wouldn’t cope if they weren’t able to work

8th October 2024

Scottish Widows launches flexible Income Protection to tackle issue.  

Less than one in 10 (8%) people in the UK have cover in place* if their income stopped suddenly and 42% of UK adults worry that their household wouldn’t cope if they were unable to work**, according to new research from Scottish Widows. The research** also revealed a gender protection gap with 29% of surveyed women saying they couldn’t afford protection compared to 23% of men. Worse still, over a quarter (29%) of women surveyed said they would expect to rely on a partner’s income if they were unable to work.

These concerning figures have been revealed as Scottish Widows launches its new Income Protection product, which has been created to help bridge the income protection gap. The product has been designed to be simple and easy to understand for both established protection advisers, holistic advisers, and those who may be new to advising in this area.

Key product benefits include:

• Fracture and hospitalisation cover – included as standard with no extra charge.
• Rehabilitation/Proportionate benefit – a top-up payment to help clients resume work.
• Partnership benefits- clients can benefit from a range of partnerships available through Scottish Widows Protect:
  - ‘Clinic in a Pocket’ (included in cover) to receive a GP sick note quickly and access to a GP 24/7
  - A dedicated personal nurse service in partnership with Red Arc.
• Immediate income payment – received whilst the claim is still being assessed, provided a GP note is supplied and once the deferred period has passed.
• Mental health underwriting – Scottish Widows won’t decline an income protection application for mental health without an underwriting review conducted by a real person, rather than AI. We also ask the customer if they’re doing anything to improve their condition, for example improved nutrition, sleep or exercise. Where customers are proactively taking steps to improve their mental health we can provide better underwriting rates.
• Price lock promise – guarantees the quote for up to 12 months, subject to underwriting terms being imposed.
• Reduced earnings with our minimum benefit guarantee, even if your client’s earnings have reduced, if their monthly claim payment is £1,500 or more, we won’t pay them less than this.
  

The intention is to build financial resilience for clients against financial shocks in their moment of need and enable a greater number of advisers to incorporate income protection into their recommendations. This Income Protection launch enhances the suite of products available through the recently digitised Scottish Widows Protect platform and via the UnderwriteMe Protection Platform portal; the product will be available on other protection portals in the coming weeks. These latest developments provide advisers with a streamlined application process, an accelerated underwriting journey, and a better client experience.

To reflect their changing needs, clients can amend conditions throughout the life of cover including the policy term, the deferred period, and the sum assured. As part of the launch, Scottish Widows has joined the Income Protection Task Force (IPTF), formalising its long term commitment to open dialogue on ways to extend income protection across the country.

Rose St Louis, Protection Director, Scottish Widows, commented: “Life doesn’t always go in a straight line and an unexpected adverse health event can have a significant impact on our ability to remain financially stable. This is where products like income protection can come to the rescue and have a meaningful impact in reducing income 'troughs' if you’re unable to work due to illness or disability. Launching Income Protection is part of our effort to help customers feel prepared, no matter what life throws at them.

“Our research shows women are less likely to have protection, and we want to be part of the solution towards closing the gender protection gap while also making it easy for established protection writers, as well as those new to protection, to write this type of business.”

Jo Miller, co-chair of the Income Protection Task Force said: “The Income Protection Task Force (IPTF) welcomes Scottish Widows' timely launch of their flexible Income Protection cover, addressing a critical issue highlighted by their recent research: a significant gender protection gap. This will support the pressing need for accessible and affordable income protection solutions. This product, designed for simplicity and flexibility, looks well positioned to help address these disparities and support a broader demographic. Additionally, integration of this product into the digitised Scottish Widows Protect platform should enhance the overall client experience.

“Scottish Widows' membership of the IPTF signifies their long-term commitment to collaborative efforts aimed at expanding income protection coverage across the UK. We look forward to continued dialogue and initiatives that will drive greater awareness and adoption of income protection solutions.”

Download full press release (PDF, 292KB)

Notes 

* The survey data was collected and analysed by Censuswide Research. Total sample size was 4,043 UK adults including 1,000 self-employed and 1,000 private renter respondents. Fieldwork was undertaken between 17th and 29th April 2024. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+). 

**The survey data was collected and analysed by YouGov plc. Total sample size was 2,059 adults. Fieldwork was undertaken between 2nd - 8th February 2024. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+). 

About Scottish Widows

Founded in 1815, Scottish Widows is part of Lloyds Banking Group, the UK’s largest digital bank and financial services group. With more than £210bn assets under administration and 6 million customers, Scottish Widows’ award‐winning product range includes workplace and individual pensions, annuities, life cover, critical illness, income protection as well as savings and investment products. Customers can access our products and services through independent financial advisers, directly, and through all Lloyds Bank, Bank of Scotland and Halifax branches. 

About Income Protection Task Force

Since 2005 IPTF have worked to raise awareness of income protection amongst advisers and consumers in the UK by working collaboratively, providing educational resources and insights and ultimately helping to boost sales of income protection.

Media contacts:

• Eduard Lewis | eduard.lewis@theagencypartnership.com | 07814715929
• Martyna Stepien | martyna.stepien@scottishwidows.co.uk | 07515164565
• Kimberley Hamilton | kimberley.hamilton@scottishwidows.co.uk | 07900702105