Why financial institutions need to act now
No one is ever immune from losing their job. And while this risk is always there, today’s glaring headlines on layoffs can make that risk feel very unnerving or possible for people.
The timely nature of this risk presents financial institutions with an opportunity to step in and educate borrowers on protection solutions available to help offer peace of mind if borrowers face unexpected job loss. Doing so could mean big value to your borrowers and your business in return.
The reality of involuntary unemployment
In the first five months of 2025, U.S. employers announced approximately 696,309 job cuts—an 80% increase from the same period in 2024 and is 65,049 cuts away from matching the entire year’s total for 2024.1
Tariffs, funding cuts, consumer spending and overall economic pessimism are putting immense pressure on companies’ workforces. Companies are spending less, slower to hire and sending layoff notices.
Consumers feel financial pressure
In Securian Financial’s recent consumer sentiment study, 90% of participants are concerned about unexpected expenses and 76% are concerned about sudden income reductions.2
Many report using emergency funds or credit cards as vehicles to manage these risks – which as you know, can be detrimental to their financial well-being.2
Why financial institutions should act now
With job loss top of mind, lenders can shape the conversation to shift from emergency savings and credit cards to their involuntary unemployment benefit within their payment protection programs.
Payment protection for involuntary unemployment can help offer peace of mind to borrowers, knowing that their loan is protected when faced with sudden job loss. It can help them use their emergency funds for other essentials than loan payments while they’re looking for new employment.
There are significant benefits for your business too.
- Reduce defaults: When borrowers lose income, protection products step in to cover a certain amount of the loan. This lowers the risk of defaulting and protects your portfolio performance.
- Generate non-interest income: This benefit creates another stream of income that’s not tied to interest rate fluctuations.
- Build borrower trust and retention: Offering protection solutions reinforce a sense of care and support. Trust and confidence can translate into greater loyalty and reduced attrition.
- Set yourself apart from other lenders: With job security a looming concern, you can use your involuntary unemployment benefit as a differentiator in the market to help you stand out.
Your trusted partner for what’s next
Now is the time to share this benefit with your borrowers. And if you don’t offer this benefit within your payment protection program, Securian Financial is here to help. We work closely with financial institutions across the country to establish strategies that can propel your program to its highest performance. We can help you understand the current state of your business, identify opportunities and help you implement them into your day-to-day business.
Contact us today, and let’s grow your program to its full potential.
