If you are feeling a little down, then you can take solace in the thought that things are unlikely to get any worse. “21 January, say experts, is the unhappiest day in the entire year” said one national newspaper.

Well, things did get worse. Blue Monday – the day when UK consumers are hit by unpaid Christmas bills, gloomy weather and the realisation those New Year resolutions simply wont work – got steadily darker and darker as the stock market suffered its worst day of trading since the terrorist attacks in New York in 2001.

Fears of a recession sparked a 5.48% fall in the value of the FTSE 100 on the Monday, the biggest percentage fall in a single day since 9/11.

Although reports stated about £78bn had been wiped off the value of the City’s blue-chip stocks, the fall was less than half that of the stock market crash in October 1987 when shares fell by 12.2%. Rightly or wrongly, Blue Monday looked like the beginning of a recession in the UK.

As we enter a period of uncertainty, several reports have emerged as to how to tighten the purse strings when things get tough. One report stated “ditch any policies you do not need”, particularly payment protection insurance or accidental death and injury.

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It is certainly prudent for brokers to help their clients make sure they have not doubled up on any policies – for example, the client may be covered by an insurance offered by their employer. However, some of the wording of these pieces of ‘advice’ has, in my opinion, been quite dangerous.

The recent news of HFC Bank’s fine of over £1m for PPI failings was both shocking and, if the FSA report is anything to go by, deserved (mortgagesolutions-online.com, 16/01/08). However, should customers be abandoning any protection policies, particularly as now appears to be the time when people are in danger of losing their jobs and even their homes?

Surely this is the time when consumers should be urged to go and speak to a financial adviser, to look at their finances and assess where they can make some savings while also protecting what they have accrued.

Who is going to speak to the public of the benefit financial advisers can bring, particularly when the market looks like it is going to take a nosedive?

Even for those who are happy to pay for some kind of protection, research from Axa has suggested this is not always enough. A global life insurance report launched by the giant provider has suggested around 71% of UK adults now have at least one life insurance policy. Buying a home and access to professional advice are seen as key triggers for UK adults to purchase insurance products, unlike other developed countries around the world.

However, despite the majority of people now having some form of life policy, the AXA study reveals that few UK adults are adequately covered.

Furthermore, if the trigger for getting life insurance begins to recede – that is, if house purchases continue to decline – how will consumers be protected? A drive towards advice is surely the only answer. n