Don’t pick up your insurance along with your loaf of bread

Many people are now buying their insurance alongside their groceries in supermarkets like Tesco’s and Sainsbury’s – without having really thought about the product they are buying.

Like the sweets at the checkout – which are a marketing ploy to get you to you buy them while you wait to be served – every supermarket has their personal finance products up by the till, tempting you to buy them.

However, the problem is that unlike buying the wrong brand of coffee or stale crisps, people only find out about failures in an insurance policy when it is too late to put it right.

Simply by picking up the policy, you could end up in financial disaster.

And while it is the high street banks and lenders that are being criticised for ripping off customers with over-priced sometimes unsuitable policies, the supermarkets who do sell payment protection insurance (PPI) can be just as guilty.

Now that the Office of Fair Trading (OFT) is considering referring the PPI market to the Competition Commission, improvements in the marketplace will hopefully happen in the future as lenders sit up and take notice.

However, what happens to the consumers in the meantime? People tend to accept the PPI cover the offered by their lender or buy on the spur of the moment in their local supermarket. However, more often than not they could get a cheaper policy simply by shopping around.

Simon Burgess, from independent protection provider BritishInsurance.com, says: "They are paying the price for apathy.”

So next time you are picking up your groceries, try and turn a blind eye to the colourful leaflets selling insurance by the shopping till. Do your homework and shop around – you could end up saving hundreds of pounds.