Burgess Supports Introduction of Groceries Protection Insurance

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The offering of Groceries Protection Insurance by standalone provider Safety First is inspired and should be applauded says Payment Protection Insurance lobbyist, Sara-Ann Burgess from specialist firm Burgesses

Sara-Ann Burgess, MD Burgesses

Cynics may accuse Safety First of scaremongering, but I believe families will have to cut back on their monthly grocery bills if a wage is lost and there's no replacement income. Being thrifty is one thing, but losing the means to buy basics is another.

The offering of Groceries Protection Insurance by standalone provider Safety First is inspired and should be applauded says Payment Protection Insurance lobbyist, Sara-Ann Burgess from specialist firm Burgesses.

She comments: "It hits home the importance of having the means to pay bills should an income be lost by highlighting the fact that a family may have to reduce their food bill if the breadwinner loses his or her job."

Traditionally marketed as income protection, this type of cover pays a pre-agreed monthly tax-free benefit to the claimant should redundancy, accident or sickness occur. Payments are made for up to a year and benefits are purchased per £100 of cover, up to a maximum of £1500. This allows the policyholder to determine what income is needed to pay bills and set the premium accordingly.

Safety First is the first PPI provider to introduce a Grocery Protection product and so raise the spectre of the weekly or monthly grocery shop moving down the priority list because of cash issues. Whilst many may balk at the idea of going hungry in order to pay other bills, it could become a reality for families who are already in debt, suffer a job loss and so end up having to decide whether to keep warm or eat.

According to Moneyexpert.com the number of electricity bills that went unpaid in the last six months of 2008 jumped from 1.31million to 1.96million and missed gas bills totalled 1.61million, up from 1.16 million -- indicating that families are happy to miss a bill to pay a bill and put food on the table.

However, food and non-alcoholic drinks only take fourth place in an average family's expenditure*, behind transport, recreation/culture and housing, fuel and power, suggesting Brits have other priorities ahead of eating.

Sara-Ann continues: "We've heard of cases in the media where elderly people are going hungry in order to pay their utility bills so we know this is a reality. Unfortunately, many opt to keep warm, especially during the cold snap, and miss a meal. I suspect families that are cash-strapped will cut down on other outgoings, such as recreation and culture, but as the recession continues and debt levels rise, the prospect of families questioning whether to keep warm or put food on the table may not be so far off.

"Cynics may accuse Safety First of scaremongering, but I believe families will have to cut back on their monthly grocery bills if a wage is lost and there's no replacement income. Being thrifty is one thing, but losing the means to buy basics is another."

Safety First likens its product to the supermarkets' 'basics' and 'value' ranges -- no extravagant packaging or hype, just a simplistically worded product with substance.

Sara-Ann concludes: "If more people purchase cover as a result of being fearful of not being able to pay food bills should their salary go, then it's a job well done. It's a prudent measure to ensure families maintain their lifestyles in the face of adversity and could make the difference between a limited or wider choice of food.

"Whatever you call it, PPI is the one proactive thing people can do to stave off the devastating effects of the recession. It gives financial support during times of hardship, relieves the worry of mounting bills and allows people to get back on their feet."

Safety First charges £3.40 per £100 for unemployment cover, £3.90 per £100 for accident, sickness and unemployment and £1.90 per £100 for accident and sickness. It has policies for home owners, those renting and people in shared ownership schemes and offers a back to work assistance programme.

Notes to Editors

*The 2007 Office for National Statistics Family Spending Survey

Transport                                         £61.70
Recreation and Culture                 £57.40
Housing, fuel and power                £51.80
Food and non-alcoholic drinks     £48.10
Restaurants and hotels                 £37.20

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