Surge in unemployment underlines case for PPI safety net, says Paymentcare.co.uk

Date:22 October 2008

Most job sectors likely to suffer in coming recession, warns Paymentcare.co.uk

PREDICTIONS OF around two million unemployed by Christmas in the wake of a deteriorating economy have further underpinned the case for protecting loan and mortgage payments, warns standalone provider Paymentcare.co.uk.

As another 31,800 made their way to the dole office in September, taking the total number of Britons claiming jobless benefits to 1.79 million and giving the highest level of unemployment in a decade, economic indicators suggest that few sectors will escape unscathed from the downturn.

Government sources admit that thousands of public sector workers will lose their jobs over the next two years with an estimated 9,891 jobs in the prison, probation and court services being cut as the Ministry of Justice looks to save 900 million.

"Coupled with reported job cuts at the Ministry of Justice there are additional fears that job losses in the financial sector will mount as Lloyds TSB takes over HBOS, the biggest mortgage lender in the UK," said Paymentcare.co.uk'sShane Craig.

Those in work are struggling with a soaring cost of living, as inflation rose to a 16-year high of 5.2 per cent last month.


And the increased cost of food, energy and home loans could well see those who lose their jobs descend into financial hardship.

"The CBI has forecast that unemployment will rise by 330,000 to 2.12 million by the end of next year, and the British Chambers of Commerce said that the number of people out of work could rise by 350,000 over the next 12 months-this is a warning shot across the bows," said Craig.

"We have seen a significant rise in enquiries from workers looking for cover in the event of losing their job, and the enquiries are coming in from all sectors.

"If now is not a good time to take out protection against job loss, then I don't know what is."

£10,000 loan over 60 months @ 8.9% from Alliance & Leicester	With lender’s own PPI	Without lender’s own PPI	Paymentcare.co.uk LASU* policy to protect monthly repayments of loans up to £30k @ £5.95 per £100 of cover
Monthly Repayments	£265.06	£205.62	£12.23
Total cost of PPI	£3,566.40	-	£733.80
Total cost of loan with lender’s own PPI			£15,903.60
Total cost of loan with Paymentcare.co.uk PPI			£13,071.00
SAVING			£2,832.60

16 October 2008

Paymentcare.co.uk offers a comprehensive range of cover options to suit individual needs, unlike most lenders which offer just one level of cover. Cover for Accident & Sickness is available at just £2.40 per £100 of cover and Accident, Sickness & Unemployment at £3.95.

* Life, Accident, Sickness & Unemployment