Covid-19 is prompting us to protect our financial wellbeing

December 1, 2021

Is the pandemic changing your perspective in life? Whether in terms of health, finances, or future plans, people across the world saw their views shift in light of Covid-19.

And new research from Ernst & Young (EY) shows how this shift ‘prompted interest’ in getting insurance as protection. Here are some key things to know.

People ‘fundamentally’ rethought their priorities

According to the EY survey* (among people from seven countries not including New Zealand), the pandemic “fundamentally changed consumer needs”, and how people plan to boost their financial security.

Due to “universal” anxiety, people are prompted to take some action, reassess their priorities and look for more ways to protect their future – including demanding new types of insurance for their various needs.

More specifically, the report found that:

  • The top concern for people is losing a loved one, with 76 per cent reporting this reaction. The second-highest concern (73 per cent) is financial wellbeing.
  • A significant proportion of people in emerging markets feel “more severe” financial impacts, with a majority either dipping into their savings for expenses, losing regular work schedule, having work hours reduced, losing their income, or having to skip payments.
  • Where vaccination rates are lower, concerns over family and finances are higher.

On the other hand, people are responding to the pandemic’s challenges by looking at solutions for the future:

  • 75 per cent anticipate making financial preparations for the future.
  • 50 per cent of the respondents plan to save more.
  • 30 per cent plan to create emergency plans.
  • 23 per cent plan on speaking to a financial adviser about their situation.

As for insurance, with the implications of Covid-19 on our health, a vast majority of the respondents are greatly interested in protecting their health-related needs, while others are looking for key protection tools like income protection cover, to help replace income in case of losing a job.

People are prioritising preparedness

All in all, the report shows how more people are now prioritising preparedness for the future, in light of how the pandemic has affected the world.

Plus, they don’t want to “get caught in the rain again”. Recovery and preparation for any potential future crisis have become the immediate priorities.

“Consumers are keenly interested in avoiding what we call ‘long financial COVID-19,’ a sustained state of financial anxiety due to overall uncertainty and a sense of not being prepared for another highly disruptive event.”

Check out the full report here.

Thinking about your own cover?

Get in touch anytime – as insurance advisers, we’re here to help you find the cover appropriate for your health and financial needs.

*Research methodology: The survey was conducted between May and August 2021, among 4,200 people across seven countries (Brazil, Canada, Japan, the Netherlands, the Philippines, South Africa and the US).

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.