Most of the focus when it comes to workplace financial wellbeing is unfortunately at point of crisis. Very little is being done to educate employees and help them build resilience to the knocks they will inevitably face in life.

This is especially important when the three main areas of wellbeing collide.

The cyclical relationship between ill health (physical or mental) and money worries can cause huge problems for employees.

Giving them the tools and protection to better cope with some of the darkest days of their lives can have a significant impact.

Cancer

For many, the financial stress of illness like cancer can be as big a burden as the disease itself.

In its 2017 report No Small Change, Macmillan found that four in five people with cancer are an average of £570 a month worse off as a result of their diagnosis.

Increased costs such a travelling to hospital, additional medication and increased utilities bills are having a huge impact on those living with cancer. This is further compounded by the significant lack of savings people have.

In the UK, a quarter of adults have no savings at all, with a further 22% having less than £100.

With around 990 people having a cancer diagnosis every day in the UK, for many employees this is a worse financial wellbeing situation waiting to happen.

When bought in the right way, income protection could be one of the most important insurance products employees will own.

I spoke to Jo Thresher, workplace financial wellbeing expert who last year recovered from a cancer diagnosis.

Jo knows first-hand the impact cancer can have on someone’s finances; “When it happened to me at just 45, I was totally shocked and unprepared, the emotional whole life impact is huge.

“Whilst I had worked in private medical insurance for years, its only now I realise what it truly means. Having chemotherapy at home means so much, from not having to find a hospital parking space, to being able snooze on your own sofa”.

Many people living with cancer need to borrow money, but banks won’t usually lend you money because they don’t know if you’ll be able to pay it back.

Macmillan report that an estimated 30,000 people with cancer in their 40s and 50s have had to borrow money from their parents, and half of this group are having to borrow from their children.

Worryingly, the money issues caused by cancer can also negatively affect recovery, with around half of those with cancer saying the financial impact was having a detrimental effect on their overall health.  

Income protection

Around 15 years ago, when I did my first set of Chartered Insurance Institute (CII) qualifications it was common to advise people to settle their financial affairs in a certain order, the first objective being to protect your income.

The advice is still as relevant now as it was then, but in retail terms, income protection is still a little known and very misunderstood benefit.

Seen as complex and expensive, I frequently come across employees who have either never heard of it or don’t understand what it is.

Compounding the lack of love for this benefit was the fact that some had also confused it with the infamous PPI scandal.

When bought in the right way, however, income protection could be one of the most important insurance products employees will own.

Only around a quarter of employers offer staff with cancer access to benefits like income protection and critical illness insurance.

Unlike other insurance products, income protection isn’t a one-off claim – it can last for a long time. Indeed, insurance provider LV has a policy for one of its members that has been paying out for 32 years.

It’s an employee benefit that has the potential to have a significant positive impact on an employee’s life.

One of the little-known facts about benefits such an income protection is that they almost always pay out.

In 2018, Vitality paid out 97.8% of income protection claims and 99.8% of life cover. Zurich paid out 95% of income protection claims.

In total, the Association of British Insurers says that 97.6% of protection claims were paid out in the UK last year.

Unlike other insurance providers, those that offer financial help in times of need appear to really be there to support their customers with additional free services to get employees back on their feet.

Jo Thresher told me, “employers sometimes feel that reminding employees of this valuable benefit means they will go off work and claim, but it has to be a bonafide claim.

“Knowing they have this benefit means an employee can put their mind at rest and perhaps consider what other insurances they may need to buy themselves to plug any gaps”.

Raising awareness

Despite the long list of positives to offer employees protection against ill health, only around a quarter of employers offer staff with cancer access to benefits like income protection and critical illness insurance.

Alarmingly, around 20% of employers in this study say they wouldn’t know how to support and employee with a cancer diagnosis.

Even employees themselves aren’t aware of the support offered to them, with almost half of those who are living with cancer saying they were unfamiliar with the resources available at work prior to their diagnosis.

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Jo Thresher adds, “for employers who do not have income protection some financial education would help. This isn’t about pushing benefits onto employees, it’s about making them aware of the gap – maybe just the support to help them build an emergency fund could help”.

The increase in poor mental health and illnesses like cancer are now affecting so many of us.

It’s time employers really started to think about the ways in which they can help their staff proactively insure themselves not just against ill health but also a poor financial future.

Interested in this topic? Read The true value of financial wellbeing.