Fewer than 1 in 5 UK adults are “adequately” protected from health and financial shocks, according to Cover Magazine (4 March 2026). This means families could be more vulnerable to shocks and face the consequences of being unable to meet financial commitments.
A financial or health shock could have long-term implications for your finances. For example, if you’re unable to work due to an accident, your income might stop. In turn, you may not be able to make mortgage repayments and could risk losing your home.
Yet, many people put off taking steps to improve their ability to weather shocks. Some overlook it because they believe they won’t experience a shock, while others might be unsure where to start and, as a result, don’t act.
Being proactive could mean you’re in a far better position should you experience a shock and help you feel more confident about your finances overall.
Here’s a step-by-step guide that could help you review and improve your financial resilience.
Review your current provisions
Worryingly, the Cover Magazine article suggests there’s a significant disconnect between how protected people feel and the reality. Indeed, 41% of people said they believe they had sufficient cover.
Taking a transparent approach to reviewing your finances could establish a clear idea of how well you’d handle a financial shock.
Start by gathering information on what your essential outgoings are. From here, you can see how long your savings would last if you needed to draw on them. If you already have financial protection in place, check if it would still provide enough cover for your lifestyle now.
Check what cover your employer provides
As well as the steps you’ve already taken, check if your employer benefits could aid you during a financial shock.
In 2026/27, Statutory Sick Pay is just £123.25 a week, and it’s only paid for up to 28 weeks. For many households, this would lead to a hefty income shortfall. However, your employer might provide an enhanced sick pay policy, such as paying all or a portion of your income for a defined period, which could ease a shock.
Your employer might also provide financial protection as a benefit, which could pay out if you’re ill or support your family if you pass away.
Check your contract or employee handbook to understand what benefits your employer offers and how they might support your financial health.
Build a financial safety net
It’s often recommended that you hold enough in an emergency fund to cover six months of essential outgoings. This could provide you with the funds to overcome a financial or health shock.
If your review revealed your savings would last less than six months, you may want to prioritise building up your emergency fund to create a safety net.
Take out appropriate financial protection
The research published in Cover Magazine found that one of the key reasons families were unprepared for shocks was due to the low take-up of financial protection. Just 14% of adults in the UK have taken out income protection.
Income protection could pay out a regular income if you were unable to work due to an accident or illness during the term. Usually, the income provided is a portion of your usual salary, and it could help you ensure you can keep up with essential bills as you recover.
Other forms of financial protection you might want to consider include:
- Critical illness cover, which could pay out a lump sum if you were diagnosed with a covered illness
- Life insurance, which could pay out a lump sum to your beneficiaries if you passed away during the term.
To maintain the cover financial protection provides, you’ll need to pay regular premiums. The cost of the premiums will depend on your health, level of cover, and the provider you use.
Talk to us about financial protection
We could go through the different financial protection options with you and calculate what level of cover would be appropriate for your circumstances. Please contact us to arrange a meeting.
Please note: This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
Note that financial protection plans typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.
Cover is subject to terms and conditions and may have exclusions. Definitions of illnesses vary from product provider and will be explained within the policy documentation.
