The Institute and Faculty of Actuaries (IFoA) has urged the UK government to support individual financial resilience as part of its 'levelling-up' agenda over the next decade.
In a white paper published last week, the government outlined how it will boost opportunity and prosperity across all parts of the UK by 2030 by undertaking 12 “national missions”.
These are designed to improve pay, employment, and productivity everywhere, while narrowing the disparities between the top and worst-performing areas.
Halving the number of poor-quality rented homes, boosting high-quality skills training for hundreds of thousands of people each year, and narrowing disparities in healthy life expectancy, are just a few of the desired outcomes.
IFoA president, Louise Pryor, welcomed the focus on widening opportunity, but said that it is also important that the levelling-up agenda increases individuals’ financial resilience.
“As set out in our recent joint report on the poverty premium in insurance, many vulnerable and low-income consumers are offered unaffordable insurance premiums, or refused cover altogether,” she continued.
“Such consumers are often deemed by insurers to be ‘higher risk’, and this can be due to a range of factors. However, many of these factors can be outside the individual’s control, such as where they live. This then leads to financial exclusion and a lack of financial resilience amongst those who may need it most.
“Greater financial resilience will help to empower individuals to benefit from levelling-up, and help tackle financial and wider exclusion.
“We recommend that the government should consider measures to help with the delivery of a minimum level of insurance protection, providing lower income and vulnerable customers with access to an appropriate financial safety net.
“From investment in infrastructure and understanding regional health inequalities, to ensuring individuals are able to retire comfortably or access social care services, actuarial expertise and skills will be critical if progress is to be made on the various issues highlighted in the white paper.”
Image credit: iStock
Author: Chris Seekings