Summer slump in life cover enquiries rings alarm bells at comparison site

The level of enquiries for life cover plummeted by almost 50% over June and July, according to financial data comparison service Moneynet. Enquiries on Moneynet fell from almost 8,000 during May to just over 4,000.

Sales of life cover are normally consistent throughout the year, which makes the figures puzzling. "This is not so much a tail-off as a catastrophic slump, and you have to wonder how people are going to cover key outgoings such as the mortgage payment in the event of the worst happening," said Moneynet chief executive Richard Brown.

Despite current low premiums in the life market, overstretched mortgages and rising council tax and energy bills were named by Moneynet as some of the factors that could be putting people off buying life cover. It also attributed the summer slump to the World Cup, which has been found to slow sales in other areas of the economy.

"We could be looking at some very grim scenarios as consumers are obliged to tighten their belts even further. Life cover is as cheap as chips, and it is perhaps a false economy to abandon it," added Brown.

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