Accident, Sickness and Unemployment Insurance Product Guide

Accident, Sickness and Unemployment cover provides you with a short term (between 12 and 24 months) payout if you were to suffer from a medical condition which prevented you from work or if you were to be made involuntarily unemployed.

It is packaged under a number of different names by different providers including:

• Accident, Sickness and Unemployment (ASU)
• Mortgage Payment Protection Insurance (MPPI)
• Mortgage Payment Protection
• Income Payment Protection Insurance (IPPI)
• Unemployment Insurance
• Sickness Insurance
• Payment Protection Insurance

Whilst the cover comes in a variety of different names, the general overview of the cover is all very similar (although you should always check the specifics in any policies Key Features Document).

Accident, Sickness and Unemployment cover - Am I eligable?

When considering your Payment Protection Insurance is important to check that you will be eligible to claim. So who is eligible for these policies and to make a claim?

• Persons aged 18 to 65 (Cover ends on your 65th Birthday)
• Persons permanently resident in the UK
• At the start of the policy you must be working in the UK and have been doing so for at least 6 months for a minimum of 16 hours per week
• Unemployment Covers: To make a claim you must have been made involuntarily redundant or if you are self-employed your business must completely stop trading and register with the appropriate government agencies (Inland Revenue and Job Centre)
• Mortgage Covers: You must be party to a residential mortgage on which you are not in arrears at the start date

Waiting Periods for Accident, Sickness and Unemployment

One of the main areas that varies a lot between different policies are the waiting periods involved. The waiting period is the time you need to wait from having your injury (or unemployment) and when the first payout will be made into your bank account.

Waiting periods can range anything from Back to Day One Cover, where the payment is made on the 30th day but backdated to day one, to 90 days or even beyond. This can have a major effect on the premiums charged and is something that should be considered before you jump into a new policy.

It is important to be aware that even with back to day one cover, you still need to be off work for a minimum of 30 days before you can make a claim!

What will my Payment Protection Insurance cover me for?

Accident, Sickness and Unemployment cover will provide a life line in the event of 2 major events. Firstly it will cover you if you suffer from some sort of incapacity which prevents you from working. It will not cover you for things which are self induced and generally will not cover you for conditions which you have suffered from in the past 12 months. The payout would be first paid after you have been off work for 30 days (depending on the waiting period) and would continue either until you are able to return to work or up to a maximum of 12 or 24 months (depending on the policy).

Secondly your Mortgage Payment Protection Insurance or Income Payment Protection Insurance will cover you if you are made involuntarily redundant. Just like with accident and sickness, you will need to be out of work for at least 30 days until the first payment is made and it will continue to be paid for up to the same 12 or 24 months.

What exclusions exist on things like Mortgage Payment Protection Insurance?

As with all types of insurance there are standard exclusions and times when you will not be eligable to claim. Some of these occasions are:

• Normal Pregnancy and Childbirth related conditions
• HIV and other HIV related illness including AIDS
• Alcohol and drug abuse
• Conditions resulting from any civil unrest, terrorism, nuclear radiation or contamination from nuclear waste or any related event, or any act related to war
• When you have not paid your premium
• When you were aware of your unemployment or illness before you took the cover (or in the 6 months before)

Exclusions like these allow the insurance companies to protect themsleves from unscrupulous claims and therefore keep premiums to a minimum.

The easiest way to ensure you are getting the most suitable Accident, Sickness and Unemployment cover to meet your needs is to speak to a fully trained advisor who will be able to point you in the right direction.