Consumers cutting back on insurance
Hard-pressed motorists and home owners are set to jettison up to £1.5 billion worth of car insurance and home insurance cover in response to the credit crunch, a survey has found.
The poll by business analysts Deloitte found that 26% of people survey are planning to reduce their spending on insurance policies in the next 12 months.
Car insurance firms look to be hit the worst, with about 18% of people claiming they will downgrade to third party-only car insurance - many hoping to offset this year's 8% rise in motor premiums.
About 12% of policyholders will look to make cut backs on their travel insurance and pet insurance will be trimmed down by 8% of those surveyed. Such savage cuts leave the people at risk of not being sufficiently covered in the event of an unforeseen event.
However, it is the controversial Payment Protection Insurance (PPI) policies that are most likely to be dropped by thrifty consumers, with 26% of respondents planning to reduce or drop PPI in the next 12 months.
The schemes were recently flagged up by the Competition Commission when it warned consumers were being overcharged by as much as £1.4 billion a year.
PPI cover debt repayments if the holder is unable to work or loses their job.
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