Help to remind the UK public of the virtues of life insurance

When the recession bites, insurance is one of the first things we tend to cut-back on. This trend has been widely reported since the peak of the credit crunch, yet the most recent reports according to The Guardian show the true extent to which we have turned our backs on something that we used to consider so essential. A study by Sainsbury's found that around one million consumers have reduced their spend on home insurance or cancelled it completely, whilst over half a million are said to have cancelled their life insurance.

With so many of us turning our back on insurance, the government and insurance industry are now in the position of reminding the UK public of its importance. A report put together by the Chancellor of the Exchequer, Alistair Darling, and insurance executive, Andrew Moss, shows that less and less of us have any financial safety-net, such as savings or insurance, in an age when the public are living longer.

The report discusses the greater role the insurance industry can play in order to assist the government in providing for people's needs. It suggests that if the industry increased their share of risks by five percent they save the public sector £17 billion a year. In addition to this the report puts forward the consideration to appoint a financial education commissioner who will work with the financial services industry in order to deliver education and information on all aspects of money and financial security.

The report and plans are of considerable significance, but for some insurance providers, some action needs to be taken sooner to make a difference. Moss's company, Aviva, are one such insurer who is eager to remind new parents of the importance of life insurance - and to make it as accessible as possible.

Matt Morris at Lifesearch highlights that this is a limited amount of cover. But in light of further research that shows nearly half of parents not having bought life insurance, and another 17 percent who have insufficient cover to pay off their mortgage in the event of their death, the idea may be set to spark a trend among other insurers.

This latest incentive is next in a long line of such ideas set to get the public to consider how they can save money on insurance after comparison sites and extras such as cash-back. Though with the added government report, it seems likely that many of us will begin to reconsider the importance of insurance and financial security over the next few years.

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