Generation rent: the protection they need
Whether it’s twenty some-things finding their feet for the first time or forty or fifty-year-olds divorcing and leaving the family home, generation rent is expanding. The number of households living in the private rented sector in the UK increased from 2.8 million in 2007 to 4.5 million in 2017 — up 63% in just ten years1.
And although we talk about generation rent, it’s not something that just affects one generation. In 2020, people in their mid-30s to mid-40s are three times more likely to rent than 20 years ago2.
The issues facing tenants
The growth in the rental sector means that many tenants are in need of your advice. According to a survey by the FCA, 47% of renters have low financial resilience.3 And during the COVID-19 crisis, renters were more likely to have been furloughed or put on paid leave than mortgage holders.3
Despite their need for protection, renters tend to be underinsured:
- 73% of renters don't hold any protection products.3
- Just one in three (31%) renters had home contents insurance, compared with 88% of homeowners.3
But, just because tenants are underinsured, doesn’t mean that they aren’t worried about their precarious position.
How best to support tenants
Make your advice relevant
Have a look at your database and find the renters on it, if you can. Then divide this up into different groups and work out what type of protection each one could want and write to them about this.
For example, younger couples may be interested in income protection, critical illness and life insurance especially if they’re thinking about children.
Whatever group you’re looking at, talk to them as individuals about their own particular concerns at whatever stage of life they’re likely to be at.
Ask the right questions
You don’t want to scare them off by bluntly telling them all the risks of not being insured so why not ask a few questions to get them thinking about cover. For example:
- How would you continue paying your rent if you were too ill to work?
- What would be the first thing you’d have to cut back on if your main income stopped?
- How often do you find yourself worrying about how your family would cope if something happened to you or your partner?
How income protection could offer peace of mind for generation rent
Income protection is often sold to people when they buy a home so many renters get left out. Yet it can be just as relevant to them. It can help them with their monthly bills, expenses and rent should they suffer an injury or serious illness.
For example, Aviva’s Income Protection+ offers:
- Monthly payments
These will cover some of your clients’ lost earnings, helping them maintain their lifestyle while they’re away from work.
- Flexible cover
Your client can choose when their payments begin and how long the policy will pay out for if they’re unable to work.
- Supportive claims team
Our claims team is trained to understand how your client’s feeling when they need to make a claim and do everything they can to help.
- Fixed or variable payments
Options include a fixed payment that stays the same for as long as your client holds the policy or those that increase with inflation.
- Other benefits
Our cover has a range of other benefits for the policyholder and their family. These include waiver of premium, back to work benefit, hospital benefit, trauma benefit and much more. It also includes access to the Aviva DigiCare+ app* which helps clients prevent, detect, and manage common health and wellbeing concerns directly from their smartphone.
* Aviva DigiCare+ is a non-contractual benefit
To find out more about how income protection can help generation rent, visit our Tenant protection hub.