If there’s any event that could provide the motivation people need to prepare for the unexpected, it should probably be a global pandemic. And while the threat of COVID-19 has been a wake-up call for Canadians to think about life insurance, a new survey suggests they’re not necessarily taking action.
Drawing from a Google survey of 1,000 Canadians, Edward Jones found that two thirds (67.9%) of respondents have become motivated to better prepare for potential unexpected emergencies or financial setbacks, such as an accident or sudden illness, because of the pandemic.
But even with that motivation, the survey found more than three quarters of Canadians (77.1%) would suffer a negative financial impact from an unexpected emergency. That includes more than 80% of both younger Canadians (aged 25-34 years old) and Gen X Canadians (45-54 years old) who said they would experience negative impacts to their financial security if they went through an emergency.
“It's human nature to avoid thinking about our worst fears,” said Edward Jones Canada President David Gunn. “Unfortunately, unplanned life changing events can happen to anyone at any time, and Canadians can't be prepared if they aren't considering all protective options.”
While nearly 70% of respondents to the survey said insurance products are essential to their overall financial strategy, 27.74% of Gen Xers and 37.6% of younger Canadians still didn’t see insurance as essential to their financial strategy.
A look at the data also suggests respondents are split on what gets them thinking about life insurance. A slight majority (53.8%) said they’d need a trigger, like a news article, a reminder from their advisor, or a health event affecting someone they know to consider reviewing their insurance coverage. On the flip side, 46.2% of Canadians said they proactively review their coverage after a life-altering event, such as the birth of a child or purchasing a home.
Nearly half of the survey participants (48%) said they are unsure where to turn for advice or more information on suitable insurance products. And while an advisor who is insurance-licensed can be an important resource, only 11.2% said they went to their full-service financial advisor for advice on insurance products.
“A financial strategy including your insurance needs … should keep pace with one's changing values and purpose, priorities and goals, and so much more,” Gunn said. “Proactively evaluating your financial strategy with your financial advisor on an ongoing basis helps ensure you remain on track, protected, and maintain peace of mind.”