More than one in five (21%) adults are more accepting of paying for insurance policies with credit than they were a year ago, research from Premium Credit has found.
The figure was substantially higher than the 15% who were more accepting of using credit when the index reported in October 2022.
More than a third (34%) expected their standard of living and ability to pay regular bills to worsen in the year ahead, with 8% fearing their standard of living would deteriorate dramatically.
Just 16% believed their standard of living would improve.
Homeowners with mortgages were facing the most pressure, with 64% saying they would have to make cutbacks once existing fixed rate deals expire.
Around 16% said they would have to make major cuts to their household budgets.
Mortgage customers were most likely to reduce spending on going out (50%), clothes (46%) and holidays (44%).
Around 9% said they would cancel some insurance policies to keep costs down.
Around 44% said using credit helped with managing money, while 40% said the rising cost of living was making it harder to pay for insurance with a lump sum.
About one in five (20%) said price increases for their insurance made them consider credit options.
Nearly one in 10 (9%) adults had switched from paying for car insurance in one go to paying monthly in the past year, while 9% now paid monthly for home insurance instead of in a lump sum.
Adam Morghem (pictured), Premium Credit’s strategy, marketing & communications director said: “Paying for insurance with credit is becoming increasingly popular given the current cost of living squeeze on budgets which our research shows are set to tighten in the year ahead.
“People with mortgages are under the most pressure and it is understandable that many are considering cancelling important insurance policies as well as making major cutbacks to their standard of living.
“Premium finance is specifically designed for insurance buyers to conveniently spread the cost of insurance policies.
“Premium finance is a very cost-competitive means for consumers to buy insurance and better manage their finances.
“At a time when household finances are under pressure it can be a good alternative to other forms of credit.”
