Close to half (49%) of Danish workers would have little to no pension coverage if they lost their job or their ability to work, a new study by Pensure ApS has found.
The fintech firm’s study, which was based on pension information from 56,625 users of its digital pension tools, found that 51% of Danes would have pension coverage in the event that they were unable to work, however this number drops significantly among younger cohorts.
Among people aged between 22 and 26, only 21% had coverage in place. For those aged 27 to 31, fewer than half were covered.
‘A different reality’
“Many people believe that their pension plan automatically means they are financially secure in the event of a serious illness or accident. But our data shows that the reality is often quite different,” commented Pensure founder and chief executive Jon Reitz.
“It is precisely during the years when people have children, buy a home and incur debt that many discover how poorly insured they actually are. Once the damage happens, the hammer falls hard.”
Danish pension system
Pensure notes that the problem is linked in part to the complexity of the Danish pension system. Reitz said many people are expected to make decisions about pensions and financial security without fully understanding the structure or extent of their coverage.
“Danes are constantly being asked to take responsibility for their pension and financial security. The problem is that the system has become so complex that many only discover the gaps when it is too late,” he said.
The analysis also suggested that the effects of inadequate protection extend beyond individuals, with Reitz noting that a loss of income due to inability to work can affect families and place additional pressure on society.
Founded in 2017, Pensure is a developer of digital pension software, working with banks, pension companies and brokers. Read more here.
