What’s this? Halifax undertaking a cost cutting exercise in a time when unemployment is on the rise? There’s a surprise!
From 8pm tonight, Halifax General Insurance will no longer be offering Accident, Sickness & Unemployment insurance.
I think it’s pretty obvious why they are doing this but surely some clever boffins calculate how many claims they’d get from how may policy holders to know how much they need to charge to make a profit?
Unemployment may well be on the rise but don’t banks and insurers plan for these kinds of eventualities?
Of course you will surmise, I have just made a small joke.
Existing policies will remain in place but new customers will have to find a cheaper alternative (as well as an insurer still selling cover!)
Of course, in a time when unemployment is on the rise, this kind of cover may well become more expensive. If more people claim the price will need to increase to cover the cost of paying those claims.
But there’s a familiar story of people who didn’t think they’ll need cover, only to find out they are exactly the type of person who could easily suffer a sickness that prevents them from working, have an accident that sees them laid up for weeks or lose their job due to an economic downturn.
So the truth is, not everyone who could benefit from Accident, Sickness & Unemployment cover actually has it.
Cover that provides an income of between £700 – £1000 per month could cost £20 – £40 per month depending on age and occupation. Some insurers charge a lot more for people who don’t work in a nice cosy safe office environment.
Then there’s the people who have cover but may not even be eligible to make a claim.
Most insurers will want to see proof of either expenses or income before they’ll agree to pay a claim so anyone insuring more than they earn will be paying too much to have cover they can’t claim for.