Drivers ‘cutting back on insurance’ to help handle debt

Consumers are reducing their expenditure on car insurance in order to help them handle debt management, a new survey has suggested.

A poll carried out by Saga Motor Insurance has found that in order to deal with increasingly “tight” budgets, 27 per cent of drivers have taken action to lower the cost of their policies.

Eight per cent have decided to downsize their vehicle to one with a smaller engine, which the firm noted has the added benefits of using less fuel and reduced taxes.

In addition, a further eight per cent have raised their voluntary excess, which can make a premium cheaper.

One in twenty of those questioned revealed that they have scaled back on extras such as breakdown insurance, but Saga warned that this can turn out to be a “false economy” in some cases.

“It’s important to ensure the quality of the cover isn’t compromised,” commented chief executive Andrew Goodsell.

Meanwhile, the AA has urged insurance customers to be truthful with providers in order to avoid future financial difficulties.

By Jamie Price