The Association of British Insurers (ABI) has revealed this week, that 13% of people have decided to drop their life insurance cover, so they can save money during the recession.

The research shows that 13% fewer people have life cover than before the economic downturn started.  Other insurance policies have been hit too, with 64% of covers being dropped.

However, the ABI urged people to reconsider such actions, as withdrawing a life insurance policy could be a false economy and such cover should not be seen as a non-essential cost, even in times of financial hardship.

The director of the ABI, Stephen Haddril, said: “In uncertain times insurance provides a vital financial safety net to steer individuals and families through the recession, as well as helping to provide long-term security. Ditching insurance or reducing your cover must only be a last resort.”