Consumer cut backs could cost insurers £1.5 billion
A report from Deloitte, the professional services firm, is suggesting that the insurance sector could be facing a significant downturn in revenue as a result of the credit crisis.
Research conducted for Deloitte by YouGov (involving 2,286 consumers) found that 26% of respondents planned to cut back their insurance cover during the next twelve months, potentially reducing premium income for the industry by £1.5 billion.
Almost one-fifth of those questioned were planning to change their motor insurance to third-party cover and 26% said they would cancel or reduce cover on Payment Protection Insurance (PPI) policies.
In the case of motor insurance, a move away from comprehensive insurance could reflect the fall in value of many vehicles resulting from high fuel prices and government proposals on road tax.
Meanwhile PPI has been receiving bad press in for months because of mis-selling and a lack of competition in the market.
Twelve per cent those surveyed said they would be reviewing their travel policies to see if savings could be made, however, only 10% of respondents would consider scrimping on their health insurance in the coming year.
Pet insurance was also regarded as too important to tamper with; only 8% said they planned to make savings in this area.
Deloitte insurance partner, David Rush, is advising consumers to think carefully about which types of insurance cover are most valuable during a period of economic downturn.
Category: Car Insurance News, Financials, Health Insurance News, Insurance News
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