44% of people with children aged 18 or under, and/ or who are married and in a long term relationship don’t have life insurance, according to research from new firm Specialists4Protection.co.uk.

This rises to 72% when considering those without critical illness cover.

The new specialist life and protection advisory firm is targeting SMEs to help them ensure their staff have adequate life, critical illness and health insurance.

The company’s research also reveals that only 31% of people claim to have life insurance or death in service benefit through work.

It is warning that of those people with life insurance, the vast majority are “hugely under-insured”. Around 23% of those with this cover only have the equivalent of one year’s salary, and a further 19% have two years’ income.

Depending on the age of your dependants, Specialists4Protection.co.uk says that people should have nearer 20 times their annual salary in life cover – something only 3% of people with cover have.

The firm says that the problem of people having no life cover or not enough will get worse as more advisers pull out of this market. Its research with financial advisers reveals that 8% have stopped selling life insurance over the past five years, and a further 8% have plans to stop in the future. The main reason for this is that they want to focus more on selling investment products as this enables them to strengthen their relationship with clients.

Paul Litster, managing director of Specialists4Protection.co.uk said: “It’s alarming to see how many people who should have life insurance don’t, but also how underinsured most people with this cover are. If you have dependents, having adequate life insurance is one of the most important financial decisions you will ever make, but many people tend to just pluck a figure from the air when deciding on their level of cover without working out what their loved ones would need should they die.

“Many people rely on financial advisers to help ensure they have adequate cover, but with fewer operating in this market the chances of people ending up with the wrong type and level of cover increases.

“One of the best ways to tackle this problem is in the workplace, so we are targeting SMEs who want to help ensure their staff is adequately covered.”