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Finance

Insurance customers borrowing more as cost-of-living pressure bites

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INSURANCE customers are borrowing more than £500 a year on average to cover the cost of their premiums, new research has found.

Premium Credit’s latest Insurance Index shows the average amount borrowed by customers using credit to pay for insurance has risen by 26% in a year, from £400 to £505.

The figure is also sharply higher than two years ago, when the average amount borrowed was £302.

Cost-of-living pressure

The research found that 76% of adults now use some form of credit to pay for one or more insurance policies.

More than half of those who borrowed more, 53%, said the rising cost of living was the main reason, while 26% blamed increases in insurance premiums.

However, nearly a quarter, 23%, said they had taken on more credit because monthly payments were more convenient and helped them manage their money.

Credit card use rises

Credit cards remain the most common form of borrowing used to pay insurance bills, with 55% of customers relying on them, compared with 41% last year.

Premium Credit said this could be risky because of the potentially high cost of unsecured borrowing.

The index found that 11% of those who used credit to pay for one or more insurance policies had defaulted on repayments in the past year, almost double the 6% recorded last year.

Around one in eight people questioned said they had been turned down for a credit card in the past two years.

Car and home cover

The research found credit was most commonly used to pay for car and home insurance, with 56% of adults using credit to pay each of those policies monthly.

Credit was also used to pay for life insurance by 33% of adults, pet insurance by 28%, travel insurance by 28%, health insurance by 23%, and critical illness cover by 12%.

Premium Credit said customers should consider premium finance as an alternative to credit cards or overdrafts, allowing annual policies to be paid monthly for a charge.

Mona Patel, consumer spokesperson at Premium Credit said: “Insurance customers are borrowing more to cover their insurance payments due to cost-of-living pressures rather than insurance premium increases.

“However, it is notable that substantial numbers who are borrowing more are doing so because paying for insurance monthly is more convenient and better for their general budgeting in line with how they pay for other products and services.

“Premium finance is specifically designed to help smooth out the impact of a single lump sum and improve cash flow.

“Spreading the cost of an annual policy into more convenient monthly payments works for many millions of UK consumers and businesses and it can be a good alternative to other forms of credit like credit cards or bank overdrafts.”

Financial outlook

The research also found that nearly a third of adults, 32%, expect their financial situation to worsen over the next 12 months.

Just 19% expect their finances to improve, while 38% believe they will remain unchanged.

The research was carried out by PureProfile among a nationally representative sample of 1,000 UK adults between March 13 and March 18, 2026.

 

Finance

1.5 million taken to court over council tax debt, GMB investigation finds

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AT LEAST 1.5 million people were taken to court over unpaid council tax last year, according to a new investigation by the GMB union.

The union said the figures showed a council tax system “completely broken”, with cash-strapped local authorities forced to pursue residents through the courts to recover unpaid bills.

The findings, released ahead of GMB’s annual congress in Blackpool on Tuesday (Jun 9), were based on Freedom of Information requests sent to all council tax-collecting local authorities in Britain.

Almost 200 councils replied within the statutory deadline.

The responses showed that 1,430,726 people were summoned to court in the financial year 2024/25. However, because many councils did not respond, GMB said the true figure was likely to be far higher.

The investigation also found that at least 4,593,838 council tax accounts were in arrears, while debt management proceedings had been launched against 3,231,480 accounts.

In total, at least £4.6bn is owed to councils in unpaid council tax.

In Wales, the figures showed £110,884,885 was owed, with 31,452 accounts in arrears, 14,792 facing debt management proceedings, and 34,437 people taken to court during 2024/25.

Broken system

Rachel Harrison, GMB National Secretary, said: “These horrifying figures show our council tax system is completely broken.

“Not only is the banding system woefully out of date, but forcing cash-strapped councils to pursue one and a half million people through the courts just to make ends meet can’t be the right way to do business.

“Austerity left deep scars on all our public services, which will last a generation or more.

“Meanwhile the lack of authority funding often means low pay for the people we rely on to look after our loved ones, to take our rubbish, to keep our towns and cities running.

“To fix all this, we need more guaranteed central government funding, progress on council tax reform so the richest pay their share, and changes to business rates so that authorities get more to regenerate our high streets.”

The highest regional total was recorded in Scotland, where £989m was owed and 245,294 people were taken to court.

London councils reported £625m owed, with 258,732 court summonses issued, while the West Midlands recorded 239,116 court cases and £490m in unpaid council tax.

 

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Finance

Banking review launched as communities invited to share branch closure concerns

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A UK GOVERNMENT review into access to face-to-face banking services has begun, with communities, businesses and organisations being urged to submit evidence.

The independent review, chaired by former Which? director and former FCA board member Richard Lloyd OBE, will examine the impact of changes to in-person banking services across the UK.

It will look at whether branch closures and reduced access to banking services are causing harm to consumers, communities and businesses, particularly those who rely on face-to-face support.

The Call for Evidence opened today, Monday (Jun 8), and will run for six weeks, closing on July 20.

The evidence gathered will help shape recommendations to the UK Government, with final recommendations expected in October 2026.

Economic Secretary to the Treasury, Rachel Blake said: “Banking services matter to communities and businesses across the UK – and that includes face-to-face services.

“Whether you are responding as an individual or a business, your experience could shape the recommendations this review makes to Government.

“Where evidence shows people are being left behind, we will act – including through legislation if necessary.”

Richard Lloyd OBE said banking was “an essential service” needed by consumers, communities and businesses.

He said the review wanted to gather “the best possible up-to-date evidence” on the challenges faced by those who need in-person banking.

The review follows concerns across the UK about the loss of local bank branches, leaving many customers dependent on online services, telephone banking or limited alternatives.

The Treasury said the Government would act quickly where evidence showed intervention was needed to protect access to banking services.

Responses should be submitted by July 20 through the online Smart Survey on the review’s GOV.UK page. Those unable to use the survey can email [email protected].

 

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Business

Pembrokeshire workers among Wales’ higher earners, new study finds

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PEMBROKESHIRE workers are among the higher earners in Wales, according to new research analysing full-time weekly pay across the country.

The study by CV Maker, using Office for National Statistics data from April 2025, placed Pembrokeshire eighth out of Wales’ 22 local authority areas for median gross weekly earnings.

Full-time workers in Pembrokeshire earn an average of £711.30 per week, putting the county slightly above the Welsh average of £704.

The figure also places Pembrokeshire ahead of Swansea, Ceredigion, Carmarthenshire, Powys and Gwynedd.

By comparison, Monmouthshire was named the highest-paid area in Wales, with full-time workers earning an average of £773.50 per week. Merthyr Tydfil recorded the lowest figure, at £619.20 per week.

That means the gap between the highest and lowest-paid areas in Wales is £154.30 per week, equivalent to more than £8,000 a year.

Pembrokeshire’s average weekly earnings are £7.30 above the Welsh average, but £62.20 below Monmouthshire.

The figures also show a marked difference between Pembrokeshire and neighbouring Carmarthenshire, where full-time workers earn an average of £657.70 per week. That puts Pembrokeshire workers £53.60 per week better off on average, or around £2,787 a year.

Ceredigion sits closer to Pembrokeshire, with average weekly earnings of £675.70 — £35.60 lower than Pembrokeshire.

The research ranked the ten highest-paid areas in Wales as Monmouthshire, Newport, Flintshire, Cardiff, Bridgend, Wrexham, Neath Port Talbot, Pembrokeshire, Swansea and the Isle of Anglesey.

Nicky Klaasse, CEO at CV Maker, said: “These figures highlight the significant wage disparities across different regions in Wales.

“While the national average weekly earnings sit at £704, there’s a notable £154 gap between the highest and lowest-paying areas.

“For job seekers in Wales, this data provides valuable insights into where the highest earning potential might be found.”

The company said the figures were based on ONS median gross weekly earnings for full-time employees, ranked by local authority.

 

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