WOMEN AND RISK MADE SIMPLE Working with the profession to simplify the language of insurance
UNDERSTANDING WOMEN AND RISK Risk is part of life. At home, at work, on the road, on holiday, you re at risk of a loss. A damaged car, house fire or burglary, an injury abroad. The family breadwinner could fall ill or die. We all encounter risk in our everyday lives, but women are more exposed to certain types of risk. For instance, women are more likely to be victims of domestic violence, or suffer financial abuse from a partner. They are also more likely to suffer from breast cancer, and twice as many women die from dementia and Alzheimer s disease as do men. Women and financial security The risks associated with women s financial security have always differed significantly from their male counterparts. Whether the loss of a husband or partner or during times of ill health or a catastrophic event, women have frequently faced an uphill struggle to get a fair deal. Today women have a stronger voice than ever before and the financial services sector is certainly taking time to listen, and develop insurance products that provide protection and peace of mind for women are being developed though there is still work to be done. Today women have a stronger voice than ever before
Domestic and financial abuse On average the police receive an emergency call relating to domestic abuse every 30 seconds. Domestic abuse cases are at their highest level ever and 84% of victims are female. Domestic abuse is closely linked to financial abuse, where a partner is controlling someone s money or running up debts in their name. Impacts of financial abuse included going without things. In a survey of financial abuse victims, 71% of respondents went without essentials, 61% were in debt and 37% had a bad credit rating; 77% said their mental health had been affected. Higher income or professional women can also experience financial abuse, but may not be believed as people think domestic abuse is linked only to poverty. On average domestic abuse is reported every 30 seconds
Women and risk Causes of death Breast cancer is the leading cause of death for women aged 35 to 49. Heart disease is the main cause of death for women aged 50 to 64. Dementia and Alzheimer s disease is the leading cause of death for women aged 80 and over twice as many women as men die from these (13.4% of female deaths). Twice as many women than men die of dementia and Alzheimer s disease
Insuring you and your family taking care of loved ones Life insurance You typically only need life insurance if you have dependants who rely on your income, or as a condition imposed by your mortgage lender. It provides money for them if you die. It s one of the cheapest ways to protect your family's finances if the worst happens. Getting the right life insurance policy means working out how much money you need to protect your dependants. The lower the risk of you dying, the cheaper the cover will be, so smokers pay more than non-smokers, for example. You can get different types of life insurance: those that last a specific period, or your whole life, or relate to your mortgage or your income, for example. Critical illness cover Critical illnesses change lives, and have a huge emotional and physical impact on sufferers, as well as their families and loved ones. Critical illness cover pays out a lump sum if you are diagnosed with an illness that is covered by your policy. You can use the payment for anything you need, whether it is to clear debts, compensate for a loss of income, or pay for house or car alterations to accommodate a physical disability. Many critical illness policies also include cover for children.
All about insurance Why do we need insurance? When something goes wrong, for example, for major repairs, or replacing expensive personal possessions, or settling costly medical bills, it can be hard to find the money to pay. That s where insurance comes in. It takes away financial uncertainty by shifting the possible loss to an insurance company. How it works Insurers pool the risk. That is, they group together large numbers of people who face a similar risk, and collect a small amount of money from each of them. Then if one of those people needs to make a claim say, because of a house fire there is a pot of money there to help them. Can policies be priced differently for women? Not everyone will pay the same for their insurance. For example, a driver in their 50s with over 30 years driving experience is clearly a lower risk for insurance companies than a young person who has just passed their test. This is reflected in the cost of premiums. Insurers used to use people s sex when calculating the premium for general insurance products such as car, home and travel insurance. Historically, car insurance for women cost around 30% less than it did for men, as women are less likely to make a claim on car insurance policies. However, the European Union s gender directive made it illegal for an insurer to use a person s sex as a rating factor when calculating the cost of their insurance. There are other types of insurance which are not affected by this directive, including life insurance and critical illness insurance, for example.
How to buy insurance There are many ways of buying insurance. You can buy insurance face-to-face through a high street broker, but many insurers and brokers provide cover directly, either online or through call centres. Banks and building societies also offer their customers a range of insurance services, as do large retail chains. Then there are the comparison websites where you can compare products and prices from different providers. Brokers and intermediaries These are independent go-betweens whose job it is to search the market to find the best policy for your needs and your budget. They can be anything from small local businesses to large national groups, operating online, on the phone, face-to-face, or all three. Insurance brokers can help guide you on general insurance products such as car, home, travel and business insurance. Being accepted Before insurers offer you cover, they check the information you have provided to assess the likelihood of you making a claim and to decide whether they want to insure you, and on what terms and conditions. This process is called underwriting. It is important to give insurers all the information they ask for. Discrepancies that arise when you come to make a claim can be costly, so check the details thoroughly before buying. Financial planners When you want advice on products such as life insurance or critical illness cover, these are sold through financial advisers or planners. They will ask you detailed questions about your circumstances then recommend policies suitable and affordable for you. Though many do not charge for their first consultation, they should be clear about their fees and tell you in advance how they will be paid for their services.
Price comparison websites These do exactly what they say compare the price and services of a wide range of insurance companies so you can pick the one that suits you best. They do this by acting as an aggregator getting quotes from lots of insurance companies with you filling in just one online form. They can be very effective for saving you money, but be careful, cheapest is not always best. You need to make sure that you still have the right cover for your needs. It s worth remembering that no site provides all companies products, so you may still get better value direct or through a specialist broker. Further protection When you buy a policy, your interests are protected by the Financial Conduct Authority (FCA), who oversee the insurance industry. They set rules for insurers and brokers to follow, to ensure you re treated fairly. Policyholders can also seek help from the Financial Ombudsman Service (FOS), which was set up by parliament to sort out individual complaints that consumers and financial businesses aren't able to resolve themselves. Their service is free to consumers and they can order a firm to pay compensation if they think a complaint is justified.
Remember if you have any questions about women and risk, just ask me, Ciindy at @askciindy /AskCiindy