The Value of Protection for Renters

Have you considered what you’d do if you couldn’t meet your rent payments? How would you keep a roof over your head?


Reading time: 15 mins

We all know that the way we live today has changed from years ago. Statistics show that fewer people are getting married, for instance, and more people, 36% in fact, are renting.

There are now 14.8 million UK adults living in rented accommodation with almost half of 25-34-year-olds renting.

But what is surprising is that 81% of these renters have no form of protection insurance especially considering that 68% of renters are “not financially viable.”

*Sources. English Housing Survey 2017/8 & Financial Lives Report FCA 2017.

Whilst homeowners are encouraged to consider their protection needs when taking out a mortgage, renters rarely receive this prompt.

Perhaps as a result, they’re three times less likely than mortgage holders to have protection in place, leaving them without a financial security net if illness, injury, or death were to strike.

Renters face similar liabilities to homeowners, but some homeowners may have the option of reducing their monthly payments in troubled times. That’s why it’s important for renters to think carefully about the value of Income Protection, Critical Illness and Life Insurance.

Sometimes the reason people don’t have protection cover in place is that they simply don’t like to think about bad things happening.

Did you know?

  1. Over ¾ of Parents have no financial plan for dealing with lost income due to ill health.

Income Protection provides you with an income if you can’t work due to illness or injury during the policy term.

  1. The threat of developing a serious illness or condition is the second biggest concern (43%) for parents with dependent children.

Critical Illness pays a lump sum or regular income if you’re diagnosed with a defined critical illness during the policy term.

  1. 68% of people have no plan for dealing with the death of themselves or a partner.

Life Insurance pays a lump sum or regular income if you die during the policy term.

Please note that you’ll need to make regular payments for these types of protection policies. If you stop payments or cancel the policy, you won’t be covered or get any of the money back. There is no cash-in value at any time.

*Statistics from Aviva’s Protecting our families report 2017.

Ask yourself these questions

When considering these types of insurance, you should ask yourself these questions:

  • What level of contractual sick pay does your employer offer?
  • How long could you survive on savings if you couldn’t work? What are you saving for and how would you feel if you had to use those savings for survival rather than what they were intended?
  • Have you considered what you’d do if you couldn’t meet your rent payments? How would you keep a roof over your head? Would you have to move in with family members?
  • What impact would a loss of income have on your family? Would your family be able to maintain their quality of life in the event of a death?
  • What aspirations do you have for your children’s future? If you were to become critically ill or pass away, would you still want those same things for them?
  • If you were to become critically ill, would you want to stay living in your own home?

Some common misconceptions

It’s normal to have some reservations or concerns, big or small, so we thought we’d deal with a few of those now.

People often say they’d dip into their savings but realistically how long would they last and that would mean delaying, or even sacrificing, the thing you were saving up for.

Some have a perception that policies often don’t pay out but having been in this industry for many years we can definitely say that we’ve had plenty of clients who have made successful claims on these types of policy.

Obviously cost is going to be a factor for most people and lots think it’s going to be too expensive but the reality is that policies start from as little as £5 per month, and there are things you can do to keep costs low.


We’re here to chat through your options

At Markland Hill Wealth we’ve helped many families put a plan in place for if they couldn’t work, or if they or their partner died.

Understandably nobody likes to think about these sorts of things happening, but it’s important to make sure you and your loved ones have a financial safety net in place – just in case it does.

How would your family cope if you lost your main income?

Even if they spent the bare minimum needed to get by, 1 in 3 families couldn’t get through a month unsupported without their main income.

That’s why it’s so important to think about what you’d do if something happened to you or a partner. Perhaps your wider family might be able to support you for a couple of weeks – but what would happen if you developed a long-term condition?

That’s where Markland Hill Wealth comes in.

We’ll ask a few questions about your circumstances, and it may be that a simple, affordable product like life, critical illness or income protection insurance is enough to give you and your family peace of mind.

For an initial free, no obligation consultation, contact the team through with the subject ‘Renters Protection’ and we will get in touch with you in the near future to search the whole market to find cover that matches your needs and your budget.