Redundancy insurance is also known as ASU insurance or payment protection insurance and can be taken out if you have monthly loan repayments, credit card or mortgage repayments to make each month. Providing you are working full time and are aware of the exclusions which are in all policies, then redundancy cover could be a lifeline if you should find yourself unemployed through involuntary redundancy or out of work due to accident or long term sickness.
A redundancy insurance policy would begin to pay out usually once you had been out of work for 30 days or more and would continue to give you a lump sum which is tax free each and every month that you are out of work for up to 12-24 months.
You can take redundancy cover out in the form of mortgage payment protection insurance, loan payment protection insurance or income payment protection insurance and all policies work the same way and have similar exclusions which could stop you from being eligible to claim. Some of the most common include being retired, self-employed, not in full time work or if you suffer from a pre-existing medical condition. There are others and it is essential that you understand these before purchasing your cover.
Redundancy insurance can protect against the unknown but it has to be bought carefully and a good policy with a low premium will take some finding. The best way of securing the lowest premiums for your redundancy cover is to go with a standalone specialist.
Premiums do vary from provider to provider and you have to know where to look. However it is down to you to understand the conditions and key facts of your policy before purchasing to ensure that it is right for your circumstances and that you would be able to claim successfully.