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Recession forces insureds to cancel insurance
Thursday, 29 April 2010 17:03
Home_Insurance_RecessionA recent online survey indicates that homeowners are continuing to cut back or cancel their home insurance and household insurance cover as a result of the economic recession. Mortgage origination company Ooba, showed that of all the respondents who participated in the survey, 22 percent did not even have household insurance, whereas 14 percent cut back on it to pay lower premiums.

Executive director of sales, Craig Deats. says the figures are alarming. While consumers are always looking for ways to cut their expenses, insurance should never be one of them. The costs of not having insurance, should a peril befall you, is more detrimental, even financially crippling, than the monthly premium you’d otherwise have to pay.

Absa also reported an increase in lapsed insurance policies, during the first quarter of 2010. This lapse though is in home insurance and not household insurance. (Home insurance refers to the actual property upon which the home is built and the structure of the home, whereas household insurance refers to the contents of one’s home.)

The policies lapsed as insureds were unable to pay their premiums, while less expensive insurance was sacrificed to pay for insurance for larger items such as financed assets (cars and homes). The problem may get better after the recent interest rate cut.

Although a grudge purchase, one cannot really afford to without insurance. Instead of canceling your cover or reducing it, why not compare home insurance by getting quotes from multiple insurance companies. It could save you up to 30% on your monthly premiums.
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