Legal expenses insurer DAS have revealed that their figures have shown the amount of policyholders taking legal expenses cover has dropped compared to other years.
Legal expenses cover is available to policyholders as an add-on product on top of their insurance premium. The add-on covers them for general loses, loss of earnings, personal injury compensation and any legal action that they may have to take.
According to DAS sale figures, they have revealed that many policyholders are deciding not to take out the add-on product. Reasoning behind this is due to consumers keeping the cost of their premium down due to the financial situation that the UK is currently facing. Rising household bills and fuel costs are proving to be expensive for homeowners and cutting costs elsewhere such as deciding not to add legal expenses cover in addition to their insurance premium is a way of keeping their bills down.
The figures estimate that the amount of policyholders taking out motor uninsured loss recovery stands at 50% which is down from 80% compared to a few years ago. Family legal expenses has also decreased going from 70% to 40%. The figures highlight that there is a significant decrease in the amount of people who are actually covered for legal expenses.
Experts have now predicted that the decline in policyholders will lead to a percentage not being able to take legal action and/or use other benefits of the product if they needed to.
DAS said in their statement: “While aggregators are a very important distribution channel for individual motor and household insurance policies, DAS is very concerned that this growing trend to purchase on price alone will result in a significant percentage of the population no longer having access to justice as they will not be able to afford the costs to pursue a claim.”
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By Amanda Bainbridge