Reduce insurance premiums rather than opting out
- By arti manani
- Published February 26, 2009
The growing rates of unemployment during the current financial crisis have led a number of Brits battling to keep afloat.
New research by Fairinvestment.co.uk has revealed that 31 per cent of Brits have considered cutting back on spending by reducing essential monthly payments such as mortgages, loans and credit cards.
Others have revealed that they would consider neglecting other necessary protection payments such as cancelling their life insurance premiums as a bid to save.
Effects of cancelling life insurance
Chartered financial planner, Sharon Bratley of the firm advised that Brits cut back "in a way that doesn't actually cost them anything more.”
She said: “You should keep paying your mortgage and credit card bills to ensure that you don't have any further charges applied. Indeed, although interest rates are at an historically low level, many credit card companies are actually increasing their interest rates, citing the rising cost of borrowing.
However, the fact that almost a third of Brits would have to cutback on essential payments like loans, credit cards and mortgages as their first port of call suggests that they have already cutback on non-essentials like gym memberships and savings account deposits.
There is help out there for people who have reached the point where they are having to cutback on essential monthly payments. If this is the case, then it is vital to seek debt advice from a qualified debt adviser
who can talk to you about the whole range of options available, including budgeting, debt consolidation and IVAs."
Along with mortgages and credit cards, those neglecting their life insurance as a bid to save will also be losing out in the long run.
Insurer Prudential had recently warned life insurance customers of the effects of cancelling their policies.
Kevin Carr, director of protection and development of PruProtect said: “The long term cost of cancelling a policy could end up costing a customer thousands of pounds. Not only will the person not be insured but if anything happens to their health they may not be able to replace the cover they have lost."
Instead, insurers have advised life insurance customers that they can take other measures to reduce their premiums instead of opting out altogether.
Reduce your premiums
During the current crisis, a number of life insurers have announced deals whereby premiums could be reduced.
Giving up smoking for even a year would enable you to reduce your life insurance premiums, according to an insurance broker.
Those found taking more care of their health by exercising and eating a healthy diet may also see their premiums fall.
Prudential had recently announced it will be awarding its customers by reducing their premiums if they make the effort to stay healthy.
Chief executive officer, Shaun Matisonn of PruHealth said: "In uncertain economic times like these, that extra financial incentive to get fit has never been more important and PruHealth's philosophy is to reward our members for making the effort to stay healthy."
New research by Fairinvestment.co.uk has revealed that 31 per cent of Brits have considered cutting back on spending by reducing essential monthly payments such as mortgages, loans and credit cards.
Others have revealed that they would consider neglecting other necessary protection payments such as cancelling their life insurance premiums as a bid to save.
Effects of cancelling life insurance
Chartered financial planner, Sharon Bratley of the firm advised that Brits cut back "in a way that doesn't actually cost them anything more.”
She said: “You should keep paying your mortgage and credit card bills to ensure that you don't have any further charges applied. Indeed, although interest rates are at an historically low level, many credit card companies are actually increasing their interest rates, citing the rising cost of borrowing.
However, the fact that almost a third of Brits would have to cutback on essential payments like loans, credit cards and mortgages as their first port of call suggests that they have already cutback on non-essentials like gym memberships and savings account deposits.
There is help out there for people who have reached the point where they are having to cutback on essential monthly payments. If this is the case, then it is vital to seek debt advice from a qualified debt adviser
Along with mortgages and credit cards, those neglecting their life insurance as a bid to save will also be losing out in the long run.
Insurer Prudential had recently warned life insurance customers of the effects of cancelling their policies.
Kevin Carr, director of protection and development of PruProtect said: “The long term cost of cancelling a policy could end up costing a customer thousands of pounds. Not only will the person not be insured but if anything happens to their health they may not be able to replace the cover they have lost."
Instead, insurers have advised life insurance customers that they can take other measures to reduce their premiums instead of opting out altogether.
Reduce your premiums
During the current crisis, a number of life insurers have announced deals whereby premiums could be reduced.
Giving up smoking for even a year would enable you to reduce your life insurance premiums, according to an insurance broker.
Those found taking more care of their health by exercising and eating a healthy diet may also see their premiums fall.
Prudential had recently announced it will be awarding its customers by reducing their premiums if they make the effort to stay healthy.
Chief executive officer, Shaun Matisonn of PruHealth said: "In uncertain economic times like these, that extra financial incentive to get fit has never been more important and PruHealth's philosophy is to reward our members for making the effort to stay healthy."
