According to the data, renters need to think about taking out life insurance to close what is known as the 'Protection Gap'.
Glenn Seddington, Managing Director, Tenant Shop, says: “We have listened to the feedback from our agents and they are telling us that this is something renters care about and something that they are looking to introduce to their customers."
Tenants are worried about lack of cover
Research by Sainsbury's Bank, carried out earlier this year, has revealed the extent of the problem. It found that only 26% of tenants are likely to have a life insurance or critical illness policy, compared to 41% of homeowners. Despite being less likely to have the required cover, 54% of tenants are more concerned than homeowners (48%) about the financial implications should they pass away before old age.
Moreover, 21% of renters taking part in the research said they worry about this scenario on a weekly basis, compared to just 16% of homeowners.
Seddington continues: “There is a clear appetite among tenants to get the life insurance and critical illness policy they need, but they appear not to have the same level of access as homeowners. Whether renting or buying, moving home is a key life event and the perfect opportunity to arrange cover.
Therefore, while renters are considering the best options for their broadband, energy tariff and contents cover, they should also be thinking about life insurance too."
Beating the fees ban should remain a priority
Despite being introduced over four months ago, the Tenant Fees Act still poses a challenge to letting agents and they should therefore continue to explore ways in which they can limit its impact. Guidance on how to ‘beat the ban’ has varied, but agents are often being advised to look at their business processes and consider their overall offering to tenants.
Sedington explains: “Access to additional revenue routes will be a key component in this new landscape that we find ourselves in. Products like income protection, life insurance and critical illness cover will become increasingly valuable to agents as renting becomes a lifestyle choice for many families and older people.”
Another line of business for letting agents
Through Cignpost Life, Tenant Shop is providing letting agents with a simple online life insurance product with optional critical illness cover to offer tenants.
Seddington adds: “We've been offering this solution for a while, although have only started to promote it recently. Busy tenants' need for quick and simple life insurance is greater than ever before and this should now be a solution offered by all the best modern letting agents."
