- Applications over last three months up 146% on previous quarter
- Base rate cuts and falling fuel & food prices not enough to allay fears for future
- Repossession borrower's biggest fear
- Perception of risk has changed as confidence drains away
BORROWERS are scrambling to protect their loans with PPI before they fall foul of the recession and lose their jobs, says standalone PPI provider Paymentcare.co.uk.
"Over the past few weeks our phones have been ringing off the hook with enquiries from worried borrowers who want to buy themselves peace of mind in these troubled times,"says Paymentcare.co.uk MD Shane Craig
"Every day brings more alarming headlines on redundancy and repossessions and as a result people are seriously worried now.
It's the "R" word that frightens them most, says Craig. Their main concern is to protect their home and stay as far away from the dreaded prospect of repossession.
"Their perception of risk has changed. People who wouldn't have considered the idea of insurance this time last year are no longer confident that they can escape the credit crunch unscathed.
"Despite the recent rate cuts and drop in inflation their confidence in the future has been badly shaken and they can see the value in being better safe than sorry."
Many of Paymentcare.co.uk's callers are borrowers who did consider the idea of PPI when they took out their loans but decided the cost of their lender's own protection was too high. But now that the threat of redundancy is a real consideration they have revisited the subject and have sought out the most affordable way of protecting themselves.
"For those borrowers who have lost their jobs already or who are on the brink of redundancy, it's sadly too late to protect themselves, and whilst it's a great shame that it's fear that's driving people to sign up for PPI, the most important thing is that they are now looking ahead," added Craig.
"Claims by some industry figures that the Competition Commission's recent proposal to ban point-of-sale PPI will result in huge numbers of borrowers going without protection look like being way off the mark.
"Our experience tells us that borrowers are a lot more clued up these days and aren't just waiting to be spoon fed financial advice. They are, thankfully, taking control and that's going to make all the difference going forward."
Paymentcare.co.uk offers a comprehensive range of monthly paid cover options to suit individual needs at realistic prices. Cover for AS** is available at just £2.40 per £100 of cover and ASU*** at £3.95.
* Accident & Sickness
** Accident, Sickness & Unemployment