The uncertain economic climate has for the majority of us left us feeling concerned about being made redundant. This has driven a need to find suitable redundancy cover should you be in the firing line. With so much bad press about redundancy claims being rejected now more than ever should you choose your redundancy insurance with care. This is how?
All policies have exclusions comparing just cost is a false economy if you are to have cover that provides benefits and not excuses when you make a claim. To find the most suitable redundancy cover you going to need to know what to look for.
Common redundancy exclusions:-
1. You need to be in permanent employment from 6 months before the claim event occurred (some providers will ignore short breaks)
2. Your employment ended at the end of a fixed term (annual contracts that have been renewed more than once maybe classed as permanent and not excluded from a valid claim)
3. You were dismissed as a result of misconduct
4. You were NOT UK resident
5. You accepted voluntary redundancy
6. New policy initial exclusion typically 120, 90 60 days or the best policies are only 30 days. This means if you get notified of redundancy within this time frame after just starting your policy the insurance company WILL NOT pay out
7. You were not eligible to claim contribution based job seekers allowance (not a requirement of all redundancy insurance)
The last exclusion can be difficult to establish if you are for example a foreign national working here for some years, as the benefits system is not clear and even if you do phone the department of work and pensions they are not much help in clarifying if you would be eligible.
Exclusion 7 can also catch you out if you don’t pay national insurance contributions because your earnings are low.
Most providers will link redundancy cover to your mortgage payments and or your income and is typically limited to the lower of 50% of your gross income or 130% of your mortgage payments plus related costs.
This can cause problems for the self employed and anyone with a mortgage as mortgage payments, and income will fluctuate causing occasions when your over insured and others when you are under insured.
There are providers that will allow redundancy cover benefits that are unrelated to your earnings or any debts you have and this may suit you if you need more cover to cover all your living expenses.
Can you have cover with more than one provider?
There are occasions when you may need cover with more than one provider as the maximum cover offered by the best provider may be insufficient for you protection needs.
You can have more than one policy but you need to ensure that you don’t exceed the limit imposed by both redundancy insurance providers when the benefits are combined or if they do with one that are happy for you to get additional cover elsewhere.
However if your cover is mortgage related redundancy insurance you cannot have double cover to overlap to cover the one mortgage to exceed the typical 130% of the mortgage payments and related costs. You should always check with each of the insurance providers to ensure that they will not deduct the benefits payable by the other if you were to claim and get this in writing maybe by posting your question by email.
We understand redundancy insurance cover, and the need for quality cover that will payout when you need it to. We can offer redundancy insurance from the whole market but choose and select the few we feel offer consumers the best cover and deal in the market.
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Visit quoteme4.co.uk for quality redundancy insurance and protect all your income not just your debts.
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