The recent research from Scottish Provident’s Financial Safety Net report also showed that over half (52%) of IFAs believe clients without protection would have to rely on benefits offered by the state, such as unemployment benefits. Alarmingly, half of IFAs (50%) said that people would turn to racking up debt through credit cards and loans.
Nearly half (48%) of IFAs believe their clients without protection would rely on their family and friends should they lose their main source of income. Around 47% of IFAs suggested their clients would cancel luxury items, such as gym memberships. Just 42% said people would have everyday savings that could help fund their living costs.
In spite of this, the overwhelming majority of IFAs (95%) believe their clients feel more secure when they have protection products in place. Furthermore, 89% of IFAs added that their clients felt happier when they have protection, due to the financial reassurance that it brings.
Susan Barclay, head of marketing at Scottish Provident, said: “The financial downturn and rising inflation figures means that for many, finances are particularly stretched at present.
“It is critically important that people recognise the benefits of protection products in the unfortunate event of them losing a job or becoming seriously ill. Rather than needing to turn to emergency savings, family members, or the state, those with protection are secure in the knowledge that they have stability for their financial future.
“Our Financial Safety Net Campaign is designed to help IFAs educate their clients on the benefits of life assurance and other protection products, which are at the heart of financial planning and will provide a robust safety net should they need something to fall back on in times of need.”