The media features almost daily updates regarding the severity of the economic situation with clear warnings that we should prepare for difficult times ahead and yet worryingly life still seems to be going on as normal for most clients and potential clients with little thought as to how they are going to cope when the economy really starts to feel the effect of the public spending cuts.

It is not just clients working in the public sector who will feel the pain given the likely knock-on effect for the private sector.  This could mean hundreds of thousands end up on the dole with the number of unemployed expected to breach the three million barrier by 2012*.  Paradoxically, this will put added strain on the government departments who oversee social security administration.  It's here, where the government is effectively 'the insurer of last resort' more people than ever will be queuing up to claim benefits which could themselves be further reduced  from the meagre £65.45 per week** paid out currently.

The question is, why are so many people continuing to rely on state benefits which for many would hardly provide anywhere near enough to keep up with their outgoings should they find themselves made redundant or unable to work due to accident and sickness?

Intermediaries working in financial services have the opportunity to make a real difference to this situation by helping clients understand that it's a risky strategy to claim that they 'can't afford cover' when they're spending money on coffees on the way to work, drinks at the pub at the weekend or continuing to pay mobile phone or pet insurance instead of covering the thing that pays for these items, their income!  Intermediaries have the all-important fact-to-face relationship to point out the pitfalls of becoming over extended financially or leaving themselves without any significant protection in place should their circumstances change.

Since, most people's biggest financial decision is a property purchase, it is imperative that when an intermediary is advising a client for the first time, or is arranging a remortgage, that they make sure they have insurance in place that will keep the roof over their head should they fall upon tough times and find themselves unable to make repayments because of accident, sickness or unemployment.

To find our more about Paymentshield and how our MPPI product can help support your clients please call Paymentshield Intermediary Support Team on 08450 615 700 or visit www.paymentshield.co.uk

* Jobless rise but claimants hit low www.telegraph.co.uk

**Weekly rate for Job Seekers Allowance paid to an adult over 25 www.direct.gov.uk