The Chartered Insurance Institute (CII) has recommended the creation of an independent commission on household financial security, following a model similar to the Pensions Commission, in order to address pressing challenges.
According to the report, which spans seven years and was conducted by the Building Resilient Households Group (BRHG), 12.9 million adults in the UK lack financial resilience, underscoring the country’s growing financial vulnerability. The research highlights the need for a national resilience metric and presents stakeholder perspectives, suggesting measures in a number of areas.
The report recommends that the independent commission consists of three to four commissioners, each of whom is a specialist in their own field and who together have knowledge of consumer issues, employer-employee interactions, household finances, and financial services. It adds that the commission would be supported by a small team that is knowledgeable in analytics and skilled at successfully involving stakeholders.
Additionally, the report makes two immediate suggestions that won’t have an impact on the Commission or public spending: urging companies to be transparent about employee benefits in annual reports; and amending Regulation 66 of the Universal Credit programme to permit renters, particularly those in private housing, to access rent payment insurance, similar to mortgage holders.
Grid spokesperson Katharine Moxham says: “Grid welcomes the findings of the report and supports the recommendations made.
“Employers have a significant part to play in improving the financial resilience of the UK’s working households by providing adequate sick pay and benefits for other financially devastating events such as death and diagnosis of a serious health condition. The group risk industry provides a solution for employers for this via its group risk insurance offerings, which are employer-sponsored death benefits, group income protection (for long-term sick pay) and critical illness benefits.
“Not only will the pay-outs help to maintain a household’s financial status quo but these products come inbuilt with additional support services for physical, mental as well as financial health and wellbeing. Some will also include a debt consolidation service, discount vouchers or a pay advance scheme as well as financial education – all of which can be helpful when people are struggling financially.”
