Sixty percent of Irish workers know someone that has been out of work on sick leave for more than four weeks at some stage in their working life, while 28% know someone that has found themselves in this position in 2018 alone. These were among the findings from a survey commissioned by Aviva, who say that their research points to an unprepared Irish public when it comes to their financial affairs and illness.
The Behaviour & Attitudes survey found that although people were aware of the likelihood of falling ill at some stage over their working life and knew plenty of people who been out of work for long periods of time due to illness, 40% had never given any thought as to how they would cope financially in this situation.
Speaking about the findings, Karen Gallagher from Aviva commented: “The feedback from this survey is quite enlightening, as well as worrying, when it comes to understanding public perception of what people would fall back on financially if they were unable to work for an extended period. The research also shed some light on what people consider their biggest expenditures, and what they might struggle to pay for.
“We asked the CSO, and their most recent figures reveal that an Irish household’s average weekly expenditure is approximately €1,132. That’s a significant sum of money to have to replace to meet bills and other payments if you are not in receipt of a wage.”
The Aviva survey also asked respondents which critical household expenses they would struggle to cover if they became ill and had less income for the duration of their sickness.
“Which, if any, of these outgoings are critical and would need to be paid regardless of circumstance – i.e. the bills where you might need to call on friends and family to help you with until you were back working?”
| Utility bills | 67% |
| Living expenses | 61% |
| Mortgage repayments | 45% |
Ms Gallagher said of the results: “The research also shed some light on what people consider their biggest expenditures, and what they might struggle to pay for. Of course, every household is going to have a myriad of different expenses on a monthly or even weekly basis – but the commonality is that we all have regular payments to meet.”
A financial cushion for a fall?
The survey sought to uncover what financial cushioning Irish households have and asked participants:
“Do you have any plan in mind that you could fall back on, if you were unfortunate enough to find yourself on sick leave beyond what your employer would cover?”
| No plan | 40% |
| Savings | 39% |
| Income protection | 15% |
| Cash in savings or investment prop | 7% |
| Sell a property | 4% |
Ms Gallagher went on to comment: “Four out of 10 people plan to use their savings, as a fall back to cover bills and living expenses if they were unable to work for a period.
“Savings of even €30,000 won’t go very far in the event of illness or injury, and realistically, the average household probably has much less than this figure. To put it in context, the average income protection claim paid out lasted 6.5 years. €30,000 savings would only last less than two years, based on spending €3,000 a month on your mortgage repayments, car loans, food bills and other expenses, assuming it was supplemented with a social welfare sick benefit payment.
“What’s most concerning is people’s lack of real understanding or awareness of the position they would be in if they were to get sick, with only 15% of respondents having an income protection policy in place and a further 7% with a savings/investment policy.”
