Insurance.Do Not Cut It To The Bone
Cutting down on your personal insurance cover is often the easy option when trying to lower outgoings, however many of these products are designed to provide help to you in times of need.
A survey, carried out on behalf of AEIS, shows that many of us are planning to cancel insurance policies to save money. 27 per cent of the consumers surveyed, planned to reduce their medical cover and 17% were considering canceling pet insurance.
The managing director of Morethan, says that it is a bad sign when consumers cancel the very insurance that offer protection during hard times.
Tony Solomon, confirms this view, saying you must think twice before cancelling, because loss of cover may adversely effect their family and themselves in the years to come. life assurance and critical life insurance are both too important to sacrifice. If the worst happened and you died, or fall critically ill, then cancelling your insurance could leave your family with nowhere to live, he says.
If you cannot afford your premiums you must talk to you insurer.
The British Insurance Brokers Association, says that people do not appreciate the overall value of their possessions and the cost of replacing them, if they are stolen. He advises everyone to take out buildings and contents insurance cover, but to look at reducing your cover level, as they may not need every single item covered. For example, contents insurance costs about 149 pounds a year on average, a reduction of 25% maybe possible by cancelling extra options on the policy.
Pet insurance may appear to be unnecessary, but without cover you may struggle to cover the vet bills. So which policies are you safe to cancel? Referring to health insurance, Solomon says that many people have medical insurance with their employment. However, if this is not the case, it is of the utmost importance that you protect the future of your family financially. Therefore, it would be advisable to choose Critical illness, which pays out a lump sum, rather than mortgage life assurance or health cover.