79% of advisers surveyed by Cirencester Friendly believe that their clients confuse income protection with payment protection insurance, while 63% said on a whole their clients aren’t clear on what income protection actually is.

“Changes to the State Benefits System and the way eligibility is being assessed bring the need for the individuals to ensure they are adequately protecting themselves and their families in to sharp focus,” explained Paul Hudson, chief executive of Cirencester Friendly.

“Unsurprisingly, negative press around the PPI product has made consumers wary of protection products and more needs to be done to educate consumers on the differences between PPI and other protection products in the market.

“Some providers have ventured into advertising on television to raise awareness of the need for income protection insurance, which is great but as a specialist individual income protection provider who sells through financial advisers it isn’t overly helpful when TV campaigns suggest you get it through work. Many workers do not have access to this type of benefit and may not be aware of the Individual income protection products available.”

The research also found that 85% of financial advisers believe income protection is a must have for their clients yet critical illness cover is being sold more widely than income protection. In 2011, sales of new critical illness policies were almost five times that of income protection contracts.

Hudson added: “The danger is that a person with critical illness cover may assume that they do not need income protection. Critical Illness pays a lump sum if a policy holder contracts an illness from a specified list which can vary from product to product, it will not cover loss of earnings due to an accidental injury or less serious conditions that may could stop a person working and earning a living which can be equally damaging financially.

“It’s not a case of which product is better, in actual fact the two products compliment each other and a little of both puts a client in the best possible position. Many critical illnesses can mean a significant change in a person’s lifestyle, in this instance a lump sum from a critical illness policy can be put to good use in adapting a home or purchasing specialist equipment. However, the everyday bills and cost of living still needs to be accounted for and income protection provides a regular income to cover this.”

The survey also highlighted cost (55%) and clients not thinking they needed the cover (60%) as the biggest barriers to recommending income protection for advisers. However, 62% of advisers said they would be encouraged to sell more income protection products if they had better educated consumers.

Over a quarter of advisers suggested that it was part of their job to educate consumers while 58% of those surveyed believe a Government and industry lead campaign is needed to make consumers more aware of the importance of income protection.