Brits plan to save by axing insurance cover

Five million Brits plan to reduce outgoings by cutting back on insurance cover, LV= found in a recent survey.

Most popular for cutbacks was home insurance. LV= discovered that 2.2 million households plan to reduce or cancel their home insurance policies to reduce spending.

Flood risk insurance is the most likely to be cut, with 29% of people saying this would be the first element of their policy to go.

This is despite the dramatic increase in flood claims over the last few years with an average cost of £17,000 per claim.

John O’Roarke, managing director of LV= general insurance, said: “Home contents insurance is not legally required but anyone who has suffered a flood or break in will know how important it is to have cover in place.”

Credit crunched motorists, meanwhile, plan to save money by cancelling their comprehensive cover.

In the last year, 10% more drivers chose third party fire and theft cover rather than comprehensive cover at policy renewal.

According to LV=, this figure is set to increase, with 37% of respondents declaring plans to cut back on car insurance premiums this year.

Travel insurance is also a target, with 22% saying they will reduce or cut their cover when travelling.

O’Roarke said: “It’s understandable that people are looking to ways in which they reduce their outgoings, however cancelling or reducing essential insurance cover could result in many people finding themselves seriously out of pocket if something untoward happens.

“I would just urge those looking to save a few pounds to consider the wider implications of leaving themselves without valuable insurance cover this year, as it is at time likes these, when money is short, that insurance becomes evermore important.”

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