Cutting down on your personal insurance cover often seems ideal when trying to reduce outgoings, however many insurance policies are designed to provide help to you in times of need.

A customer, undertaken for The Telegaraph, indicates that many of us will cancel insurance to reduce costs. 27 per cent of the consumers surveyed, planned to reduce their health insurance and 17% were considering a reduction in pet cover.

The chairman of AIS, says that it is a bad sign when consumers cut back on the very products that ensure their financial stability.
Tony Solomon, concurs with this opinion, saying people should think twice before cancelling, because loss of cover may have a damaging affect on their family and themselves in the years to come. life insurance cover and critical life insurance are both too important to sacrifice. If the worst happened and you died, or fall terminally ill, then cancelling your insurance could leave your family with bankrupt, he says.

Your insurer maybe able to help if you cannot afford your premiums so give them a call

The British Insurance Brokers Association, says that people do not appreciate the process and cost involved in replacing possessions, if they are stolen. He advises everyone to take out home insurance, but to look at reducing your cover level, as they may not need every single item covered. For example, contents insurance costs about 149 pounds a year on average, a reduction of 25% maybe possible by cancelling extra options on the policy.

Pet insurance may appear to be unnecessary, but without cover you may struggle to pay an expensive vets bill in an emergency. So which policies are you safe to cancel? Referring to medical insurance, Solomon says that many people get free health insurance from their employers. However, if this is not the case, it is of the utmost importance that you protect the future of your family financially. Therefore, it would be advisable to choose critical illness cover, which pays out a lump sum, rather than mortgage protection or health insurance.