Annual payments would drive one in four customers to policy changes

Some 27% of insurance customers would reduce their policy cover or switch policies to save money if they were not able to pay their premiums in monthly instalments.

That was according to research from premium finance company Premium Credit, released today (29 May 2025), which polled 827 consumers between 7 March 2025 and 10 March 2025.

Furthermore, two in five respondents said that not being able to pay in monthly instalments would affect them, while 8% said they would be forced to sell their vehicle if they were not able to pay motor insurance in monthly instalments.

Meanwhile, some 13% expected they would have to cancel an insurance policy within the next two years due to lack of funds, with motor, building and home cover being the policies most likely to be cancelled.

Mona Patel, consumer spokesperson at Premium Credit, said: “The ability to pay insurance premiums monthly is highly valued as our research highlights, with customers saying they would cut cover if they could not do this.”

Cancelled policies

The data also shows that 11% of respondents reported having already cancelled a policy within the last two years, with home contents and pet insurance being the most commonly cut policies.

Patel said: “Substantial numbers of customers say they have cancelled policies they needed in the past year and others plan to reduce cover in the years ahead, underlining the need for affordable options to fund cover.

“Cancelling insurance cover is a major risk and, in many cases, will be a false economy if consumers have to fund major unexpected bills which they could have claimed for.”