ClearDebt | Newsdesk

The elevated amount of insurance claims brought about by the cold winter weather could have a knock-on effect for insurance prices, which may harm those struggling with debt, an industry expert has warned.

Steve Foulsham, technical services manager for the British Insurance Brokers’ Association, was speaking in reaction to figures released by the Association of British Insurers.

The statistics showed that extreme conditions in December and January in the UK led to 335,000 claims, with insurers paying out around £650 million as a result.

Motor accidents and damage to homes and businesses made up most of the amount, due to high numbers of accidents on the roads and burst water pipes indoors.

Mr Foulsham said: “It wouldn’t surprise me one bit if it leads to some sort of rate hikes in the market, because of the sheer volume of claims.”

Earlier in the week, a study carried out by uSwitch.com revealed that about 5.5 million households are now in debt to energy suppliers following the freezing temperatures of the last few months.

By Joe Shervin

Many adults could fall into debt if they experience a drop in income of £300, as they would not be able to afford their mortgage repayments, a study has suggested.

Research commissioned by Callcredit Information Group and carried out by YouGov, has revealed that 25 per cent of those aged between 35 and 44 would be dicing with financial difficulty should their wage decrease by such an amount.

The findings show that people in that age bracket, with a young family to support, have been hit particularly hard by the recession and have attempted to secure higher credit limits to help them through the tough spell.

Graham Lund, managing director at Callcredit, described the figures as “highly alarming”.

He said that many of these individuals are “living on a financial precipice, where just one negative event, such as a reduction in paid overtime or an unexpected expense could have disastrous financial consequences”.

Earlier in the week, Lord Marlesford expressed his concerns over rising credit card debt as it emerged the amount had increased by £8 billion in the last year.

By Joe Shervin

Christmas spending has caused many people to become insolvent in March, new research has shown

Statistics released by R3 suggest that 31 per cent – almost a third – of personal bankruptcies that take place in March are directly related to overspending in the festive months.

Members of the trade body have predicted that over 150,000 individuals will file for the option in the UK this year.

Peter Sargent, president of the company, said that many who were struggling financially at the end of 2009 were a little too extravagant in their Christmas outgoings.

He explained: “These people will now be suffering from the Christmas Crunch, having seen their debts snowball since the large credit card bills began to hit their mats in January.”

Earlier in the week, figures released by the Consumer Credit Counselling Service indicated that more than half of the individuals it recommended bankruptcy to last year were men.

Many households in the UK have been left at risk of debt due to the coldest winter in 30 years.

New research from uSwitch.com has revealed that around 5.5 million – 21 per cent of the nation – are now in debt to energy suppliers as consumers looked to heat their homes during the prolonged chilly period.

It found that one in four – 41 per cent – of those in the red have to pay back more money than they did at the same time last year.

The independent price comparison service disclosed that the total amount owed in energy bills now stands at an estimated £728 million.

Ann Robinson, director of consumer policy at the website, said: “The increase in energy debt this year is symptomatic of the fact that we are entering an era of high-cost energy.”

Earlier in the month, figures released by NS&I’s Savings Survey suggested that the British public had been saving less this winter than they did the year before.

By Joe Shervin

Those fighting debt may be interested to hear that a report has revealed two in five people in Britain are overpaying for their energy.

A survey conducted by Gocompare.com has found that 43 per cent are shelling out too much for commodities such as gas and electricity.

The disparity means that utility companies could be withholding an extra £1.3 billion of their customers’ money.

It means that, on average, people that are paying more than required are owed £124.34 by their suppliers, with almost 10 per cent of those due a return of up to £500.

Mark Greening, head of utilities at the company, said that it is “hardly surprising” that this number of individuals are losing out, “with 37 per cent of energy customers admitting that they hardly ever check their meter readings when they get a bill”.

Last month, Mr Greening, head of utilities for the web portal advised customers to shop around for their energy suppliers as one tariff is not likely to suit everyone.

By Joe Shervin

The government has issued a warning about the country’s rising credit card debt.

Conservative Lord Marlesford raised this issue during question time and stated that the amount had increased by £8 billion over the last 12 months, meaning card holders needed to pay an accumulative £900 million in interest every month.

He implied that, had the credit companies not altered their balance sheets, there would be a “large reservoir of very toxic debt”.

Speaking for the government, Lord Faulkner of Worcester acknowledged that such businesses were not helping the situation.

He said that in some instances, these corporations were “behaving irresponsibly” and “encouraging people to get into debt”.

Lord Peston, however, squared the blame at the individuals who take out the offers, as they should be aware they need to repay it.

Earlier in the week, Peter Gerrard from Moneyextra.com claimed responsibility for the high figures should rest with the government, who needs to cut credit card rates to ease the debt.

By Joe Shervin

Women could be running the risk of debt in retirement by not contributing to their personal pensions, an industry expert has warned.

Laura Goodman, director of corporate communications at Rockingham Retirement, said that there is a distinct gender gap when it comes to saving for life after work.

She noted that pension scheme advertising is generally geared towards the male population and women may tend to leave financial matters to their husbands.

Mothers who stay at home to look after the children, she added, are not supplying funds to their savings.

Ms Goodman explained: “They are going through years of not contributing towards a pension and they are leaving themselves very vulnerable.”

Statistics supplied by Standard Life at the beginning of the month showed that half of all married men bought a single life annuity when they retired – a move that would leave their wives with no private pension if the man was to pass away first.

By Joe Shervin