GlobalData findings reveal that as many as one in ten UK shoppers are prompted to buy life insurance coverage on account of having youngsters, that means the rising variety of child-free households ought to be an actual concern for the trade. Insurers might want to make investments effort and time into their methods to sort out the potential lack of enterprise.
Time period assurance accounts for the most important share of the safety market. It is usually the safety product relying essentially the most on people having youngsters for its sale. In response to GlobalData’s 2023 UK Insurance coverage Shopper Survey, 10.5% of time period assurance policyholders purchased their coverage both as a result of they’d their first youngster or a brand new addition to the household. Whereas shopping for a brand new home (17.7%) stays the principle set off, having youngsters continues to be an vital cause for buy—and one that can not be ignored by the trade.
A major problem to the trade is that there are more and more fewer households with youngsters, and therefore fewer will see worth in buying safety merchandise. Analysis launched by L&G in June 2024 discovered that the variety of UK child-free households was on the rise and now totalled 4.1 million. Surprisingly, 67% and 87% of child-free households with a double earnings and with a single earnings respectively didn’t have a life insurance coverage coverage in place, highlighting the magnitude of the issue. The UK’s infamously excessive nursery prices, coupled with the price of elevating youngsters as an entire, are deterring many from having youngsters. In the meantime, societal stress to have youngsters is lowering. The present cost-of-living disaster will probably be one other contributing issue for a lot of households to determine to offer parenthood a miss. Life insurance coverage in addition to different safety merchandise, resembling earnings safety and significant sickness insurance coverage, are all extra related to households with a number of folks counting on an earnings. Which means insurers might want to discover a option to persuade child-free households to take out safety merchandise. With no childcare prices, such households are higher off financially on common, however they will even doubtless be extra disengaged with monetary merchandise as they could see much less of a necessity for them. Insurers might want to spotlight the advantages of holding safety merchandise amid the UK’s altering family buildings.
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