As the credit crisis continues to bite, recent reports claim that consumers in the UK are sacrificing insurance and pension products in order to reduce expenditure.
Research carried out by uSwitch.com shows that 42% of people questioned reduced their spending on such products, which potentially puts them at risk of struggling financially in their retirement as well as risking their homes or possessions if they aren’t covered by insurances.
Of those 42%, around 15% said they’d axed private medical and dental insurance policies, and 13% of respondents had ditched their life insurance policies.
Ashton Berkhauer, insurance expert at uSwitch.com, said, “There`s a big difference between cutting down on luxuries ... and cutting out ... life insurance or pension savings. The potential impact on you or your family finances if you get it wrong could be huge and long lasting.”
Finance journalist Edmund Tirbutt confirmed these findings and added that cutting back on items such as pensions and life insurances this could be a “dangerous fault” to make.
Other research, carried out by the protection specialist company Bright Grey, revealed that 25% of people said they would rely on friends and family to help them cope financially if they became unable to work due to illness, while 30% said they would turn to state benefits if needs be.
