Young adults driving growth in income protection insurance, reports Eleos

The latest trend? Income protection insurance sees a rise in popularity amidst economic instability and health concerns 

A new study by insurance specialists Eleos highlights an emerging trend in the UK income protection insurance market: young adults are increasingly driving the demand for income protection policies.  

The report, which analysed data from over 800 policyholders, reveals that people aged 25 to 34 now make up over half (52%) of all new income protection policyholders, followed by those aged 35 to 44 at 30%. 

What’s causing this change? 

This shift towards younger policyholders reflects rising concerns about economic uncertainty and health risks, particularly among those without children. The report shows that younger adults are more likely to purchase income protection insurance as a safeguard against unexpected financial shocks. Recent events, such as inflation and the 2022 mini-budget, have heightened the sense of financial vulnerability, prompting more people to consider these policies as essential protection.  

In fact, economic conditions played a role for nearly half (47%) of recent policy buyers, with inflation and a volatile job market influencing their decision. Health concerns have also surged as a motivator, with one-third of newer policyholders citing fears about healthcare access and the long-term impact of COVID-19 as factors in their choice.  

Kiruba Shankar Eswaran, CEO of Eleos, noted, “We’re seeing younger people, especially those aged 25 to 34, taking steps to secure their financial future. This trend is a big opportunity for the industry to develop solutions that meet the unique needs of this demographic.” 

Who’s taking out income protection insurance?

Interestingly, the study found that non-parents are more influenced by these external factors than those with children. For people without children, global health and economic issues weigh more heavily in their decision-making, while parents tend to focus on the immediate needs of their family. 

The Eleos report suggests that insurers can tap into this trend by offering digital-first, accessible solutions tailored to younger generations. As these customers seek out financial security in an uncertain world, it seems that income protection insurance is poised for further growth, driven by a demographic eager for stability and protection against life’s risks. 

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Josie Geistfeld Josie is an editor for Claims Media. She welcomes feedback, comments, and opinion at josie.geistfeld@barkerbrooks.co.uk