As the employment landscape continues to shift, UK workers across the country are taking decisive steps to protect their livelihoods. With unemployment now at its highest level since early 2021, a growing number of individuals are seeking both financial safeguards and reliable workplace support, reflecting a deeper sense of uncertainty in the jobs market.
Recent data from comparison website GoCompare shows that searches for income protection insurance policies covering illness, injury and involuntary redundancy have risen by 19 percent year on year over the past three months. This surge in interest coincides with a notable increase in engagement with The Workers Union, which has experienced a substantial rise in membership as workers look for cost-effective, instant and supportive solutions during a period of mounting economic pressure.
The latest labour market figures reveal that the UK unemployment rate reached 5.1 percent between August and October last year. For many workers, this milestone has acted as a wake-up call, highlighting the fragility of job security across multiple sectors. Against this backdrop, practical planning is increasingly replacing optimism, with households reassessing how they would cope financially if employment were suddenly lost.
Industry professionals say the trend is neither surprising nor temporary. Dale North of insurance broker Pure Protect notes that rising unemployment almost always brings a parallel increase in enquiries for redundancy-related cover. His observation reflects a wider shift in behaviour, as workers respond to economic signals with caution rather than complacency.
At the centre of this shift is accident, sickness and unemployment insurance, commonly referred to as ASU. These short-term income protection policies are designed to provide temporary financial support, typically offering monthly payments for up to one or two years in the event of redundancy. While such policies often come with exclusions, including voluntary redundancy or dismissal for misconduct, they are increasingly viewed as a necessary buffer rather than an optional extra.
Broker Best Insurance reports that enquiries for unemployment insurance in the first three months of 2025 were double those seen at the start of last year. Claims activity has followed a similar trajectory, with an increase of 180 percent between the first and third quarters. Cover of around £1,000 per month is currently costing workers in the region of £50 per month, underlining the financial trade-offs individuals are willing to make for peace of mind.
Kesh Thukaram, founder of Best Insurance, suggests that demand is no longer confined to those taking on new financial commitments such as mortgages or loans. Instead, concern is spreading across the wider workforce. He points to a growing awareness that securing alternative employment may no longer be straightforward, particularly in a cooling labour market where vacancies are tightening and competition is intensifying.
Despite this rising demand, the market for unemployment cover itself has shrunk significantly over the past decade. Before the financial crisis, redundancy protection was commonly bundled with mortgage products. However, regulatory changes following widespread mis-selling scandals fundamentally altered how these products could be offered. According to Mr Thukaram, the withdrawal of major insurers has left unemployment protection as a specialised product, with fewer providers willing to shoulder the risk during periods of economic strain.
Experts remain sceptical that worsening unemployment will entice new insurers back into the market. Mr North argues that profitability concerns continue to outweigh opportunity, particularly when claims volumes are expected to rise. He also warns that the sector could contract further in 2026, potentially limiting choice for workers at a time when demand is at its highest.
In this climate, the role of organisations that focus on worker wellbeing and accessible support has become increasingly prominent. The Workers Union has seen a marked increase in interest from individuals seeking clarity, reassurance and practical guidance as they navigate uncertain working conditions. This growth reflects a broader desire among UK workers for trusted structures that respond quickly and affordably to real-world challenges.
As economic pressures persist, the message from the workforce is clear. Preparation, protection and informed decision-making are now central to how people approach their working lives. Whether through financial products, help and supportive services or a combination of both, UK workers are adapting to an environment where resilience has become essential rather than optional.
