Economic squeeze forces Americans to ditch insurance and choose food: A dangerous trade-off
Nearly one in three Americans has downgraded or canceled insurance coverage due to rising living costs, stagnant wages and economic instability, with younger generations (Millennials and Gen Z) disproportionately affected.
Many Americans, especially younger adults, are postponing major purchases like homes (22 percent) and cars (eight percent), with nearly a quarter now viewing renting as a smarter financial move than homeownership.
Twenty-four percent have reduced home or auto insurance, while 29 percent have downgraded or canceled coverage entirely – often opting for bare-minimum plans, leaving them vulnerable to financial crises.
Families prioritize immediate needs (food, rent) over insurance, with a third willing to forgo coverage temporarily and one in five considering dropping it if premiums rise further.
While most see insurance as essential, only 37 percent trust insurers to pay claims fairly. The crisis reflects decades of wage stagnation, corporate greed and policy failures, demanding systemic reform.
A recent survey by Guardian Service reveals that nearly one in three Americans has downgraded or canceled insurance coverage in the past year due to rising living costs, high interest rates and economic instability. The hardest hit? Younger generations – Millennials and Gen Z – who are delaying major life purchases.
Millennials (40 percent) and Gen Z (32 percent) are disproportionately affected, forced to delay milestones previous generations took for granted. Many are abandoning the traditional path of homeownership, with 12 percent downsizing their “dream home” expectations and nearly a quarter now viewing renting as the smarter financial move in 2025. The American Dream, once defined by stability and upward mobility, is being rewritten by economic necessity.
When budgets are stretched thin, even essential protections become expendable. Nearly 24 percent of Americans have reduced home or auto insurance coverage to save money, while 29 percent have downgraded or canceled at least one type of insurance in the past year.
Car insurance has taken the biggest hit. Fifteen percent have scaled back coverage, and eight percent have switched from full coverage to bare-minimum liability plans. These cuts may lower monthly bills but leave families dangerously exposed to financial catastrophe in an accident or disaster.
This gamble reflects desperation, not recklessness. Families are making impossible choices in an economy that no longer works for them.
Insurance: A luxury many can no longer afford
Despite the cuts, insurance remains widely valued. Seventy-seven percent see car insurance as essential, and 57 percent say the same for homeowners or renters insurance.
Yet trust in the industry is crumbling. Only 37 percent believe insurers will reliably pay out claims, a skepticism fueled by rising premiums and opaque policies. When corporations prioritize profits over people, families are left questioning whether coverage is worth the cost.
This isn’t just a post-pandemic blip. For decades, wage stagnation, corporate consolidation and government policies have eroded middle-class stability.
The 2008 financial crisis, followed by years of low interest rates and speculative bubbles, set the stage for today’s affordability crisis. Now, with inflation lingering and borrowing costs at a 20-year high, ordinary Americans are paying the price.
Who’s to blame? Policymakers who dismissed inflation as “transitory.” Corporations that jack up prices under the guise of “supply chain issues.” Insurers that raise premiums while denying claims.
The solution isn’t just lower rates or stimulus checks – but systemic reform that restores affordability and trust. Until then, Americans will keep making brutal trade-offs. A nation where insurance is a luxury and homeownership a fantasy is a nation in decline.
Treasury Secretary Scott Bessent explains how the working class reap major benefits under Trump’s economy. Watch this video.
Nine out of 10 homeless women are missing from official government figures, charities have said.Solace Women's Aid and Single Homeless Project have said their research shows that the current rough sleeping snapshot, carried out by the Ministry of Housing, Communities and Local Government, is inadequate. The charities blame gender-biased collection methods and say 54% of homeless women are missed out of the official government counts because they spend the night […]
Post comments (0)