Life insurance means children’s financial futures not ‘left to chance’

17 June 2009 / by Rachael Stiles

Millions of British children are having their financial futures ‘left to chance’ because their parents are failing to get adequate life and critical illness insurance to protect their offspring if something happened to them.

In a study carried out by life insurance provider Bright Grey, more than seven million parents in the UK admitted to not having an insurance policy in place to protect their children from potential financial catastrophe in the event that they passed away or became critically ill.

More than 1.6 million British parents said they had never even considered how their family would cope financially if they lost their income.

Ten per cent of parents expect their children to be able to use family savings in the event that they lost a parent, but with the average Brit saving just £1,000 last year, Bright Grey is concerned that this provides scant security for Britain’s children.

Bright Grey suspects that the 64 per cent of British parents who do not have adequate protection in place to secure their children’s financial future, are being restricted by the current economic conditions putting pressure on their finances.

But, the insurance provider says, it can cost just £20 a month for a 30-year-old male to insure his life for £87,000 worth of cover – much more protection than most people would ever save.

“People might be shying away from sorting out cover because it seems a time-consuming task or an expense they don’t need at the moment, but the cost of life cover has been falling over the last few years,” says Roger Edwards, proposition director at Bright Grey said.

“People don’t want to think about the financial consequences of themselves or their partner not being around, but it is one of the most important areas of your finances to get right, especially if you have a dependent family,” Mr Edwards urges. “It is worrying that so many families admit to not having sufficient protection in place, but are doing very little to address this.”

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