Renters – Lets tackle the ‘protection gap’.

In the UK, the private rented sector has more than doubled in size since 2002. And most are living without any kind of financial safety net.

While property buyers are encouraged to consider their protection needs when they take out a mortgage, renters rarely get this prompt, often never addressing the risks they’d face if they couldn’t meet their rent.

To combat this, Aviva has launched a campaign encouraging advisers to discuss protection with clients living in rented accommodation.

The campaign targets what Aviva have said is a growing “rental protection gap” and offers advisers tools and resources to encourage renters to consider protection in the same way they would with a mortgage client.

In 2017, the Financial Conduct Authority found renters were three times less likely than mortgage borrowers to have arranged life protection insurance.

Of the 14.8m UK adults living in rented accommodation, 81 per cent had no form of protection insurance, it found.

Paul Dalgliesh, head of protection propositions at Aviva, said advisers were in a strong position to help address the growing rental protection gap.

He said: “The UK has seen a significant rise in the number of people renting – from young single urban professionals who may not be able to afford to buy, couples and families, through to older singles who may be divorced and ex-homeowners who are starting over again.

“Often, renters never address the risks they would face if they couldn’t meet their rent.”

Mr Dalgliesh said the aim of Aviva’s new protection campaign was to help advisers initiate relevant conversations with potential protection clients.

Generation rent is a huge market the protection industry cannot ignore, and Aviva’s campaign is a move in the right direction.

People who rent still get ill and experience bad events – if this demographic was ignored just because they are not traditional homeowners, it would be disingenuous.

If your children, partner or other relatives depend on your income to cover rent or other living expenses, then the answer is yes – you probably do want some kind of insurance.

Each year one million people in the UK find themselves unable to work due to a serious illness or injury. Through having the right protection in place this covers you, if you can’t earn an income for those reasons. If something happened to you, would you be able to survive on savings, or on sick pay from work? If not, you’ll need some other way to keep paying the bills and you might want to consider taking out insurance.

Do feel free to get in touch with our mortgage advisers Wanda Moore and Kyna Cupples directly if you have any questions around this topic. T:02892 605 088  |  E: info@fairstoneni.co.uk

Sources:

 http://www.aviva-for-advisers.co.uk/adviser/site/public/building-your-business/protection-insurance-for-renters?source=IPrenters&entry=144735&cmp=soc-pro-avr-lin-post3

 https://www.ftadviser.com/protection/2018/08/29/aviva-looks-to-tackle-rental-protection-gap/

https://www.moneyadviceservice.org.uk/en/articles/do-you-need-life-insurance

https://www.moneyadviceservice.org.uk/en/articles/do-you-need-income-protection-insurance