A new study has revealed that more than 35 million Britons have no financial safety net to help them through losing their jobs or a major downturn in the economy.
Research by Aegon found that 45% of those surveyed would have to rely on their savings if the main breadwinner was made redundant or unable to work for six months or more.
Almost 75% are exposed financially because they have no income protection insurance or a critical illness policy. One in ten said they would be completely unable to cope if they lost their job.
Figures from The Money Charity show that 36% of British households have no savings to fall back on.
The main reason given for the lack of coverage by those interviewed was cost, but they were unaware of the range of policies available to them and their relative affordability.
Aegon’s Simon Jacobs said: “Protection is an important safety net that can help people meet their monthly expenses, ranging from mortgage repayments to their supermarket shopping.
“However, the reality is that far too many people in the UK are putting themselves and their families at unnecessary risk by not taking steps to financially protect themselves.
“It’s also worrying to see so many people relying on their savings for financial protection. When it comes to saving, most people have a goal in mind, whether that’s a foreign holiday, house extension, or setting a little extra aside to enjoy in retirement.
“Whatever the reason, it would be a shame to have to spend all your hard-saved money on just staying afloat. Especially when the cost of a protection policy can be built around what you can afford to pay. Between five and ten pounds a month is surely a price worth paying for increased peace of mind.”
Separate research from Scottish Widows found more people were likely to insure their mobile phone than take out any income protection or critical illness policy.
Spokesman Gary Burchett said: “It’s a worrying truth that people are more likely to insure their mobile phones than their own health. On a societal level, we increasingly think in the short-term, caring more about tangible things in our day-to-day lives.
“On a more fundamental level, we’re programmed not to think about the worst happening. Together, these are dangerous inclinations, as people aren’t thinking about insuring their health or life until it’s too late.”