The Center for Economic and Policy Research believes that this year’s recession will cause at least 4.2 million people to lose their health and life insurance coverage. For existing policyholders, it would be prudent to switch to term-life insurance.

If you have a group policy, you most likely will lose your coverage if you lose your job. An individual term-life insurance policy has portable coverage and is usually less expensive and if you’re in good health, you can probably get more coverage.

The organisation also observed that there is also an increasing number of borrowers opting for basic life cover rather than full protection. Recent research from My Mortgage Direct found that only one in five borrowers are signing up for life assurance along with their new mortgage deal, with many blaming financial difficulties as the reason they have not taken out cover.

Given these uncertain economic times, life insurance companies are most worried about their customer base being unable to keep up payments because of increasing living costs and other financial obligations, such as rising mortgage and credit repayments.