Brits Urged To Keep Hold Of Financial Safety Net

The current economic climate means it is important for Britons to take steps to protect their finances, it has been suggested.

According to British Insurance, an independent payment protection provider (PPP), it is crucial that consumers make sure they will be in a position to meet bills and other demands on their spending should they end up losing their income as a result of an accident, becoming ill or losing their job. And with people facing dramatic rises in the cost of living it was reported that making sure that having a “financial safety net” to help protect loan and mortgage repayments is particularly important during difficult money management times.

Meanwhile, the PPP pointed to predictions by utilities watchdog Energy Watch claiming that the cost of gas and electricity is set to rise by 40 per cent. Such an increase, it was stated, will see increase the typical annual utility bill surge by some 400 pounds. And with other spending commitments, such as loan and mortgage rates, also reported to be set to increase in months to come the firm suggested that it is crucial to make sure people provide a level of protection with regards to their spending.

Simon Burgess, managing director for British Insurance, said: “More than half a million people face redundancy every year and building society research shows that 73 per cent of the population couldn’t support their families if they lost their job. This is a frightening statistic and one that is easily addressed by the purchase of a cheap, yet comprehensive policy that pays out should there be a change in financial circumstances.”

He added: “People who are struggling financially now need to consider what it would be like if they lost their monthly income - it would be a nightmare scenario, but one that could be avoided.”

The managing director went on to assert that taking out a payment protection policy will be of particular assistance for those who lose their job and do not have enough savings to help them make payments on loans and mortgages, as well as “the plethora of bills” they face in areas including groceries, council tax, telecoms and utilities.

Mr Burgess stated that while getting a payment protection insurance policy can provide much needed monetary assistance for consumers, it is important that they shop around for a plan which is competitively priced.

Whether looking for assistance with managing financial commitments during the credit crunch, meeting the cost of higher bills or looking to make a major purchase applying for a home loan might be of assistance. In making the decision to select this kind of loan, borrowers could find they are left with an affordable rate of repayment to make each month. However, for those wishing to protect their finances the monetary assistance a loan brings could help borrowers to purchase comprehensive payment protection insurance.

Shopping for cover could also be recommended for consumers after a recent study by Tescocompare revealed two-thirds of consumers are opting to renew a policy with their current home and contents insurance provider despite about half of all Britons reportedly being on track to face an increase in their premiums.

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