Rising unemployment emphasises the need for Payment Protection Insurance (PPI), it is claimed.

Defaqto states that with 165,000 more people becoming unemployed in the last three months, people are worried over what might happen with their mortgage.

"People who borrow money, or those who already have debts, are likely to be interested in purchasing some form of protection insurance in the next few years," comments Brian Brown, head of insight at Defaqto.

He adds that, at the very least, people need to prioritise their assets, as there is "little point taking PPI cover for your credit card bill or a loan if you haven’t first protected your mortgage".

Cancelling PPI insurance on a mortgage is not a sound debt management decision to make, Mr Brown believes, as this could prove disastrous if a person were to lose their job.

A similar conclusion on the unemployment statistics was drawn by Burgesses this week, with its PPI lobbyist Sara-Ann Burgess urging people to take out a policy.

She said that increased redundancies and repossessions further accentuated the need for people to make sound financial planning.