Don’t get caught out

Cutting down on your insurance appears easy when trying to reduce costs, however many policies are used to provide help to you in times of need.

A survey, carried out on behalf of The Telegaraph, shows that many of us will cancel insurance to reduce costs. 27 per cent of the consumers surveyed, planned to reduce their health insurance and 17% were considering canceling pet insurance.

The managing director of AIS, says that it is a bad sign when consumers cancel the very products that protect them.
Tony Solomon, agrees with this view, saying it is dangerous to cancel you insurance, because loss of cover may have a damaging affect on their family and themselves in the years to come. life cover and critical illness insurance are both too important to sacrifice. If the worst happened and you were to die, or fall seriously ill, then cancelling your insurance could leave your family with without hope, he says.

If you cannot afford your premiums you must talk to you insurer.

The BIBA, 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 home insurance, but to look at the different levels of cover, as they may not need all your possessions covered. For example, contents insurance costs about 149 pounds a year on average, but you should be able to save 25% by cancelling accidental damage and personal possessions cover.

Pet insurance may appear to be unnecessary, but without cover you may struggle to be able to afford the vet bills. So which policies are you safe to cancel? Referring to medical cover, Solomon says that many people are fortunate enough to receive health insurance as part of their employment package. However, protection of your family is important. Therefore, it would be advisable to choose Critical illness, which pays out a lump sum, rather than mortgage protection insurance or private medical treatment cover.