53% of people who are in a couple and both working say they need both incomes to pay all of their monthly living costs, according to the latest research from protection, investment and retirement specialist LV=.
The LV= Reaching Resilience report recently revealed how working families are more vulnerable to financial shocks by not adequately protecting their income.
The report found that over a third of working adults are supporting children living at home, with 8% supporting adult children – while over 75% of respondents reported that their income covers at least one other person.
With the need to protect one’s income now more pertinent than ever, and even though married couples are more likely than single people to hold an income protection product (13% vs 4%), the take-up is still low.
According to LV=, not having appropriate cover in place could affect long-term goals such as building up savings, buying a house or becoming parents.
Similarly, if a stay-at-home parent or caregiver was unable to carry out their duties, this could also impact the household either through shared responsibilities or extra childcare costs.
Mike Farrell, protection sales and marketing director at LV=, said: “Our latest research found that more than half of working couples are reliant on a second income to pay monthly outgoings.
“When applying for protection cover, many people focus on the main earner, but the household contributions of stay-at-home parents and caregivers are equally significant.”
“If they were unable to do their everyday tasks, this could create financial difficulty if the family doesn’t have the right safety net in place,” he warned.
To combat this, LV=’s Flexible Protection Plan has a comprehensive range of products with features to suit different lifestyles.
To enable advisers and clients to have relevant protection conversations, LV= has developed a digital menu tool to help bring its products to life.
Protection Matchmaker is a new support tool to help advisers navigate the full range of LV= protection options.
Launched on 11 May, this will equip advisers with the knowledge to create bespoke protection plans tailored to the different needs of their clients.
Farrell added: “Menu protection plans can offer a tailored approach so that families can maintain their lifestyle at the same time as protecting their individual personal incomes.
“Several protection policies can be combined into one process, such as Income Protection, Family Income Benefit or Critical Illness cover.
“Family dynamics are diverse and constantly changing. Contemporary protection has moved beyond having a single insurance policy to provide a more flexible financial safety net.
“We have been working with advisers to create a digital tool that will help them navigate the range of LV= protection options available.”
He concluded: “Advisers can easily design personalised protection solutions to suit the unique requirements of their clients, making a real difference to them and their families.”
