Almost one in three young mortgage holders have no protection cover, according to new research from LifeSearch and HomeOwners Alliance.
The new research highlights a worrying gap between the risks younger mortgage holders face and their understanding of how to financially protect themselves. Young mortgage holders appear especially vulnerable to income loss, with 12 per cent saying they would consider a bank loan, while 29 per cent would rely on additional work to keep up with mortgage payments if faced with income loss.
While young adults are working hard to get themselves onto the property ladder, many are doing so without the protection in place to keep their homes should life take an unexpected turn.
The new research, which came from over 1200 homeowners, including 500 mortgage holders in the UK, found that 54 per cent of the 18 to 34-year-old mortgage holders surveyed report having life insurance. However, LifeSearch and HomeOwners Alliance say that this finding may present a more positive picture than the reality.
LifeSearch suggests actual take-up may be significantly lower. Notably, nearly a third (30 per cent) of young mortgage holders report having no protection cover at all – including life insurance or critical illness cover which would pay out a lump sum to loved ones in the event of death or serious illness, or Income protection which would replace one’s income if illness or injury left them unable to work.
This lack of awareness and cover could leave thousands exposed to financial difficulties if left unaddressed. The data also shows that 14 per cent of young mortgage holders would immediately struggle to meet their mortgage payments if they lost their income due to sickness or injury, more than any other age group. Over half (57 per cent) said they would be in difficulty within six months.
Closing the awareness gap
“This is a generation full of ambition – but without the guidance and support to match,” said Debbie Kennedy, CEO at LifeSearch. “Many under-35s are navigating some of life’s biggest financial commitments without knowing what protection is available to them, let alone having it in place.
“Income protection isn’t just for older workers or high earners – it’s for anyone who depends on a regular income to cover essential costs. Without it, the impact of a sudden illness or accident could be significantly more concerning. There’s an urgent need to close this awareness gap. That means clearer advice, better signposting, and conversations about protection starting earlier.”
When asked how they would cope with a sudden loss of income, many younger mortgage holders listed short-term stopgaps:
- 29 per cent said they would try to take on extra work
- 23 per cent would cut savings or pension contributions – jeopardising long-term financial health
- 21 per cent would turn to government support such as Universal Credit
- 12 per cent would consider a bank loan
These techniques could help in the short term, but could eventually increase financial vulnerability, particularly for a generation already facing stretched budgets and uncertain job prospects.
Paula Higgins, CEO at HomeOwners Alliance, also commented: “Buying a home is a proud moment – but it comes with risks. For young homeowners, the stakes are high: many have stretched to afford their property, and their financial resilience is often still being built.
“We need to do more to support young people in staying financially secure, especially as they take on the long-term responsibility of a mortgage. Ensuring they have the tools, knowledge, and support to weather life’s ups and downs is essential to helping them hold onto their homes and build a stable future.”
