A new survey published this week has suggested that many people in Britain don’t fully understand what is on offer from financial products in the UK, with Life Insurance proving especially problematic.
Conducted by Gocompare.com, the price comparison website with the annoying but effective adverts, the survey found that the average British person is confused by the various forms of insurance, credit cards and debts in particular.
For example, 44 per cent of people believe that life insurance does not pay out for suicide when, in reality, suicide is usually covered by policies that have been in place for a year or more, although different providers will vary.
Furthermore, 18 per cent of those questioned think that their credit card debts are wiped when they die. Unfortunately, this is not the case and an individual’s estate will actually be required to pay before any assets can be passed on to the beneficiaries.
Commenting on the survey results a spokesman for Gocompare.com said, “No one likes to think about what will happen when they die, particularly if it’s before reaching a ripe old age, but you owe it to those you’d leave behind to ensure they aren’t left in a financial mess when they are trying to pick up the pieces after your death.”
Campaigners have pointed to the results of this survey as yet more evidence that basic financial education should be included on the syllabus of secondary education as one of the life skills required to cope with the modern world.
Analysts have said that, whatever the implications for the future shape of education in schools, everyone purchasing a financial product should research the market first, read the small print of what they are being offered and take independent financial advice if necessary.
Those people who have life insurance should update it if their circumstances change, most especially if their number of dependents grows through the birth of children or grandchildren. However, customers should be careful not to over reach and must keep up their premium payments or else the lump sum benefits could be forfeit.
