Those of us who are mature enough will remember the old adage ‘spend a penny today and save a pound tomorrow’. This saying could have been invented for insurance as it sums up the whole reason for insurance. But during tough economic times pet insurance is too often the item that falls off the end of the financial table when economies have to be made.
Everyone knows Murphy’s Law extends to animals too, so it is inevitable that as soon as you cancel your pet insurance premiums, Rex or Tiddles has an accident or develops a health condition that requires ongoing and expensive veterinary care. This could mean some very big vet’s bills that would have been covered originally by your insurance premiums now having to come straight out of your bank account or credit card. This could mean the build-up of some pretty frightening levels of debt over a relatively short space of time.
As soon as you realise you are in debt and before that debt spirals out of control, seek professional advice without delay. Contact a debt management company whose specialist skilled advisors will guide you along the path to being debt free. Always choose an organisation which is a member of DEMSA (Debt Mangers Standards Association) and is OFT approved (Office of Fair Trading).
Together with your advisor you will create a debt management plan, which is an accurate account of your incomings and outgoings every month. Whatever amount remains after all your household essentials are paid (including your pet insurance) is your ‘using’ money and it is from this fixed amount that your debt advisor will be able to approach your creditors and arrange a repayment solution with them.
If your debts amount to more than £12,000 then your debt professional may advise you to enter into an IVA (Individual Voluntary Arrangement). Your advisor will fully explain the IVA to you and will guide you through the process. The IVA replaces all existing payments to creditors with one lump sum, which is spread out over your creditors so that you pay something to each one every month. It is a legal requirement that all interest is frozen when an IVA has been entered into, and the amount you will pay will be dependent upon how much you owe and how much ‘using’ capital you have.