New research by www.justmoney.co.za reveals that one in five people can no longer afford to insure their car or their home.

As the cost of living spirals, www.justmoney.co.za asked visitors to its site what they would do when faced with higher insurance premiums. Whilst 38 percent said they would shop around for cheaper cover, a staggering 18 percent admitted they could not afford insurance anymore.

Paul Beadle, managing director of www.justmoney.co.za, said: “It is not surprising that when money gets tight, expensive items like insurance cover get sacrificed in the list of financial priorities. But not having adequate insurance cover is dangerous and could turn out to be more costly in the long run.

“Not only is vehicle insurance a legal requirement, anyone that does not have insurance in place for their car or home could end up seriously out of pocket if they suffer a loss due to an accident or a theft. Replacing items such as TVs, DVD players and computers could cost more than the actual insurance cover, whilst crashing a vehicle that is on finance means you will still have to pay off the loan even if the car is a write-off.”

www.justmoney.co.za asked visitors: 'What do you do when your vehicle or home insurance premiums increase?'

• 38 percent said, 'I shop around for cheaper insurance premiums.'

• 31 percent said, 'I just pay the new higher premiums.'

• 18 percent said, 'I can't afford to pay for insurance anymore.'

• 13 percent said, 'I negotiate a lower premium with my insurer.'

  www.justmoney.co.za says that consumers should always try and lower their insurance premiums by shopping around for other quotes to compare as well as negotiate with their existing insurer to see if they can better their latest quote.

  Just as importantly, people should keep their insurers up-to-date with the latest information about their belongings which means the cost of cover could be potentially reduced. For example, if the value of a vehicle has decreased the insurance premium could drop. However, if you have new items such as jewellery or electronic goods these should be added to your insurance policy.

  “Insurance is seen as a grudge purchase — something we know we need, but because it seems so expensive we try to get it as cheaply as possible without any thought as to whether it is the right cover or most cost-effective policy," continues Beadle. "People need to review their insurance regularly, just as they would their investments or a home loan, so that they know they are getting the maximum value for money — and protection — from their insurer.”

  
  

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