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An IVA may be a better way to save money than cutting back on insurance cover.

The British Insurance Brokers Association (Biba) says that consumers and businesses are reducing their protection during the recession.

Eric Galbraith, chief executive of Biba, says that going for the cheapest cover is also not the best option when it comes to saving money.

"It won't necessarily be tailored to you and you will have something where what you want covered is not covered. Just make sure you've got the right cover," he advises.

Households which feel that increasing debts means they need to drastically cut their expenditure - which could include their insurance - may instead want to tackle their financial commitments with an IVA.

Up to 70 per cent of cash owed may be cleared, while interest on debt could be frozen.

Recent research from Biba shows that 96 per cent of brokers say that motor and home insurance are the most popular classes of personal lines insurance facing the chop by cash-strapped Britons.

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