Thousands wasted on unnecessary insurance
(21 January 2008)

Brits waste thousands of pounds on "unnecessary" insurance, according to one expert.

The Which? Essential Guide claims that many of these "peace of mind policies" pay out in very few cases and the majority of what is covered by them is often already protected by legislation or existing insurance policies.

The consumer watchdog cited ID fraud losses as something which will be covered by people's banks, while accidental death and injury may be covered by standard life insurance.

Tony Levene, author of the Which? Money Saving Handbook, said: "You can buy insurance to cover yourself against almost any conceivable risk - even alien abduction!

"The insurance industry's favourite phrase is 'peace of mind', but it uses this to justify policies that cost a lot and are almost impossible to claim against."

He added that people should carry out risk assessments of their own and make informed choices about whether they actually need the insurance.

Meanwhile, a recent report form MoneySupermarket.co.uk has shown that people are wasting thousands of pounds annually by having the wrong mobile phone tariff.

The price comparison site said that many users do not know how many minutes and texts they are entitled to, which leads to them incurring extra charges of up to £130 per year.