Over the last 15 years the number of unmarried, co-habiting couples in the UK has increased dramatically. According to data from the Office of National Statistics there were 2.9 million co-habiting couples in 2012, up from 1.5 million in 1996.

While most co-habiting couples are made up of a man and a woman, there are also an estimated 69,000 families consisting of a same sex cohabiting couple and an additional 66,000 civil partnered couples in the UK.

If you live with your partner but you’re not married or in a civil partnership, the rules governing your financial arrangements are different to married couples. Next, we look at what co-habitation means to you and why co-habiting couples are more likely to leave their partners at financial risk.

What co-habitation means for you

If you have lived with your partner for a long time you may believe that you have the same rights as married couples or those in a civil partnership. However, you would be wrong.

In the UK there is no such thing as a ‘common law marriage’ in the eyes of the law and there are no rights attached. This can mean you put you and your partner at financial risk if you don’t make proper arrangements.

For example, no matter how long you’ve been living together, if one of you dies, the other will not automatically inherit their assets. And, co-habiting partners are not automatically entitled to a share of finances after a split, or to their partner’s pension after he or she dies.

Making appropriate financial arrangements is essential but new research has found that only a small number of co-habiting couples have taken steps to protect their partner in the event of death or illness. Keep reading to find out more.

Unmarried couples less likely to take out life insurance

A new survey has found that while the number of unmarried co-habiting couples has rapidly increased in the past decade, few are likely to take out life insurance.

The study of 2,000 people by Santander Insurance found that finances were a major factor for people wanting to move in together. However, just 23 per cent of respondents would rely on life insurance in the event of the death or illness of their partner, meaning that the majority of people could find themselves under huge financial pressure if the worst were to happen.

Mark Russell, the head of marketing at Santander Insurance said: “There has been a significant increase in the number of unmarried family units and unmarried couples tend to consider life insurance less than married couples.”

If you plan to co-habit it is important that you make sure your pension and life insurance arrangements provide for your partner. For example, couples who live together, unlike married couples, are not entitled to receive the state pension or bereavement allowance for deceased partners. In addition, many occupational pensions will not pay out to unmarried partners.

Experts suggest that you take out some form of life and critical illness insurance in order to provide a lump sum for your partner were the worst to happen. If you put these policies in trust and make a will you can ensure that the proceeds are paid to your partner – even if you are not married.