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Surge in demand for payment protection

24th September 2008 Print
News that the deteriorating economy is beginning to inflict a toll on the jobs market has seen a commensurate surge in demand for unemployment insurance protection polices, says Paymentcare.co.uk.

Last week alone, when the global financial crisis hit new highs, the volume of calls to the standalone PPI provider shot up by nearly 50 per cent.

With official figures showing that recruitment across a wide range of jobs is falling at its fastest rate for seven years, Paymentcare.co.uk reports a significant rise in enquiries from workers looking for cover in the event of losing their job.

“We are being bombarded with enquiries from all sectors, and the common theme is that people are finding the cover offered by High Street lenders exorbitantly expensive.

“A growing number of applicants are telling us that they’ve always thought PPI to be a good thing but simply can’t afford the prices the high street lenders want to charge.

“On top of that, more people seem to be aware of the ongoing competition enquiry into PPI, a sure sign that consumers are becoming ever more savvy when it comes to their personal finances,” said Paymentcare.co.uk managing director Shane Craig.

“As the economy looks to be toppling over into recession, there are clearly a lot of worried people out there, and Loan PPI (payment protection insurance and MPPI (mortgage payment protection insurance) makes sense in the current climate.

“But while workers want the safety net of knowing they can cover outgoings in the event of being made redundant, they do not want to pay through the nose – which is why we are taking a lot of business away from the high street,” he said.

In recent weeks, several airline collapses including transatlantic carriers Zoom and Silverjet, have led to hundreds of cabin staff losing their jobs, while in the City, UBS is in the process of shedding 900 staff and Commerzbank is expected to cut at least a 1,000 jobs as a result of its merger with Dresdner Kleinwort.

“The British Chambers of Commerce recently predicted that the economic slump would lead to unemployment soaring by between 250,000 and 300,000 in the next two to three years and that total unemployment of more than two million is on the cards – it is a tough climate out there so we are not surprised to see such a substantial increase in our enquiry levels,” said Craig.