Tenants are being urged to take out life insurance as the number of people renting for longer and later into life rises.
Life insurance cover is usually encouraged when people take out mortgages, an opportunity long-term renters are not offered.
Tenant Shop say that as a result renters are falling down what they described as the ‘protection gap’.
A study by Sainsbury's Bank from June this year found renters were significantly less likely to have life insurance or critical illness cover, with just 26% of renters taking out a policy in comparison to 41% of homeowners.
In the past decade, the number of households renting privately with children has risen by almost 800,000 to nearly 1.6 million and without life insurance they are leaving their families exposed to financial difficulties should they pass away.
Possibly as a result of being less likely to have life insurance or critical illness cover, 54% of renters are more concerned than homeowners (48%) about the financial impact should they die. They are also more likely to worry about their situation, with 21% of renters living in private accommodation concerned about what would happen if the worst happened, compared to 14% of homeowners.
Glenn Seddington, managing director, Tenant Shop, said these results showed a “clear appetite” among tenants to take out life insurance and critical illness policy. He said the issue was one of “access,” although the Sainsbury’s survey found the main reason tenants did not have life insurance was because they believed they don’t have enough equity or money to have a life insurance policy, with 29% giving this as an explanation compared to 11% of homeowners.
“Whether renting or buying, moving home is a key life event and the perfect opportunity to arrange cover,” Seddington said.
“Therefore, while renters are considering the best options for their broadband, energy tariff and contents cover, they should also be thinking about life insurance too.”
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