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5% Slump in young people taking out life insurance

The number of young people buying life cover has fallen by 5 per cent in the past year, according to Lifesearch.

The protection company released its new business figures,which showed that people aged 35 years and under buying some form of life cover had fallen by 5 per cent to 31 per cent in the 12 months from January 2006 to 2007.

Lifesearch says research suggests younger people make poor product choices, with those aged 18 to 29 almost six times more likely to insurance their life than their income, even though they have no dependants.

Only 12 per cent of the 18 to 29 age group felt they had purchased the product which best suited their needs and 37 per cent of this group bought on price alone.

Lifesearch head of protection strategy Kevin Carr says: “More work needs to be done to reach the 35 and under age group, so they understand why protection is important and which type of cover is best for their individual circumstances.

“Many are buying no financial protection, or are relying on the internet to get the best deal, which might work in car insurance, but not with financial protection.”

CBK principal Peter Chadborn says: “It proves that protection is becoming commoditised and is delivered and sold like a commodity which downvalues it. People are having families later and getting on the property ladder later too which explains why fewer younger people are perhaps taking out protection.”

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