Life insurance expert says ‘single women and mothers taking big risk’ | Personal Finance | Finance

A life insurance expert has issued a stark new warning specifically aimed at women.

The specialist revealed that women are significantly worse than men when it comes to protecting themselves with insurance, particularly those who are single and childless. Historical research consistently demonstrates that women are considerably less likely to have taken out life insurance and other protection policies, such as critical illness cover and income protection, compared to their male counterparts.

In some instances, surveys have indicated that women are twice as likely to be uninsured. Katy Eatenton, owner of Weybridge-based Eatenton Finance, noted that underinsurance amongst women is especially prevalent among those who are single and on a comfortable income.

Katy said: “There are more and more high-flying female entrepreneurs, which is fantastic to see. But in my experience very few, a tiny percentage in fact, have any insurance in place to protect their incomes.

“The general reason, when I speak to these women, is that they don’t have children, so why do they need insurance? But when you ask them how they are going to keep on top of their mortgage or rent and deal with a sudden loss of income if they are unable to work for a year or two due to an accident or ill health, the penny starts to drop. For whatever reason, men are slightly better at understanding the importance of income protection, but more single women without children need to take control of this area of their lives and plan for the unexpected.”

Katy highlighted that the issue of underinsurance equally affected women in relationships with children: “Where women are the secondary earners in a relationship, often because they have had children and are working part-time, or are stay-at-home mums, the level of underinsurance is once again shocking.”

Katy attributed the widespread underinsurance among mothers to the fact that their role was fundamentally undervalued.

She said: “When I’m speaking to a couple with children, it’s common for them to believe that the person who needs to be insured is the person who earns the most, often the man in the relationship, if the woman has taken time off work to bring up the children. But that dangerously downplays the key financial support provided by stay-at-home mums, or mums working part-time, and ignores the significant replacement cost of full-time childcare.

“There’s a perception that the mum is not worth insuring because she either doesn’t get a payslip at all or because her payslip is smaller, if only temporarily. It’s only when the mum is incapacitated that the true cost of everything she does becomes apparent and the household finances come under real pressure.”

Katy warned that the situation was deteriorating further, as rising household bills, coupled with higher mortgage rates and rents, were leading families to increasingly view insurance as a luxury rather than a necessity, with women in relationships typically being the ones to miss out.

She continued: “When money’s tight, people question the value of insurance even more and it’s not unusual for a couple to only insure the higher earner. Again, that undervalues the financial role of the female in the relationship.”

Katy explained that it wasn’t solely women in relationships who were underinsured, as a significant proportion of single mothers also had no protection in place to support their children should they fall ill or pass away. Paradoxically, she noted, it was women’s maternal instincts that worked against them when it came to taking out insurance.

She continued: “One of the most common reasons for mums not having insurance, in my experience, is that they are laser-focused on looking after everyone else first and too often leave themselves to last. But then, of course, they never get around to it.

“And that’s when, if they have health issues or die, things can suddenly get very serious. My message to all women is to take control of whatever the future might throw at you and get insured.”