Essential Information For Public Sector Employees to Escape the Financial Misery of Redundancy
Up until now, Public Sector jobs have largely escaped the ravages of the recession. Although for Defence related jobs, budget cuts have already begun to bite. Because of this, many Mortgage Protection and Income Protection Insurance providers are currently turning down applications from people who work in the Defence industry, believing they now represent an exceptional level of risk. What is meant by risk? The Underwriters think in terms of the number of redundancies made by a specific employer proving much higher than average. The same view is taken about people working for several Councils currently implementing staff reductions. Therefore, it is probably the last chance for the majority working in the Public Sector to buy this type of insurance, before the deep post election budget cuts begin.
State benefits are pitiful compared to the real cost of living for the average family or young couple living in the UK today. When denied their ability to earn a living wage by accident, sickness or unemployment, everyone needs money to fall back on. The fortunate have savings, however the majority will find themselves in real financial trouble within weeks. Research published in 2008 established that most people of working age have less than 2 months wages saved, with 25% reported to have nothing at all. This applies equally to Public Sector employees. Therefore, having an insurance policy that covers all important bills whilst out of work, makes a great deal of sense. For those that need this insurance, get it now before the Underwriters say ‘no thanks’ to Civil Servants and all Local Authority employees.
For anyone employed full time (at least 16 hours per week) in the Public Sector and where there are not any reports of any impending threats to jobs, it would be prudent to consider getting a quote right now. If a Government Department or Council for example, has made an announcement regarding cut backs, a recruitment freeze or layoffs, it is probably too late to buy this cover. Without any doubt, now is the time to get a low premium deal, rather than wait for this cover to rocket in price, or applications to be simply denied altogether.
Even those who already have this type of insurance, perhaps just covering a mortgage or a single loan, should check if they have sufficient benefits. For working couples, particularly where the main wage earner is employed, say, by a Local Authority, it could be prudent for them to take out additional low cost cover whilst it is still on offer.
Mortgage Payment Protection Insurance (MPPI) is designed to cover monthly mortgage payments and can usually be increased by up to 25% to contribute toward other expenses related to the home.
Income Protection Insurance (often called Lifestyle Protection) is very similar to MPPI, however it is designed to replace the majority of net income if the person insured is unable to work. As it pays out for up to a year it is more accurate to describe this as short term income protection insurance. It is not limited to mortgage repayments. However many providers cap their maximum monthly benefits at £1500, some £2000. It is rarely more because the Underwriters make the assumption this would be enough for most buyers to pay their monthly bills.
Most buyers tend to be only be interested in unemployment cover in the mistaken belief health related benefit is less important for them. However there are relatively few providers of unemployment only cover and frequently their competitors will offer full Accident Sickness and Unemployment cover for less! More importantly with 2.4m people in the UK claiming Disability Benefit (Dept of Work and Pensions 2008) the risk of health related claims is greater than many think.
The best rates are available on line where Income Protection and Lifestyle Protection Insurance can be bought without the expense of telephone sales or high commission to inflate the price. Moneysupermarket are a good source of comparison quotes, however the summary of cover should always be read very carefully to ensure what each provider offers for the price, really is like for like.
A web based comparison service is provided by the FSA. This is entirely independent and not trying to sell anything. Their tables also include quality measures, although as a result they are quite complex and therefore not easy to use. However they represent a good place to research a shortlist of suppliers to compare quality as well as price.
Applying for Income Protection, Mortgage Protection or Payment Protection Insurance on-line is a great way to save money. However the acceptance criteria applied by different underwriters varies. If applying on-line does not work out, it may simply mean the applicant is one of many who need advice regarding what to buy. This is where the specialist broker or Independent Financial Adviser can add value to their clients. Ultimately it is worth seeking out on-line bargains first as, quite understandably, the cost of expert advice will always be reflected in the price of the product.
Dennis Haggerty FCII M IDM Marketing Manager iprotectinsurance.co.uk specialises in the supply of low cost on line Lifestyle Protection, Income Protection and Mortgage Payment Protection Insurance.
Key to the success of i:protectinsurance has been the focus upon supplying a product range that is available exclusively on-line. By eliminating the usual costs associated with selling insurance: telesales teams, direct mail, middlemen and commission, i:protect can offer customers exceptional value for money.
The i:protectinsurance product range includes Income Protection / Lifestyle Protection, Mortgage Payment Protection, Gadget Insurance and Mobile Phone Insurance called Phone PLUS.
Income Protection Insurance and Mortgage Payment Protection Insurance
Article Source: http://EzineArticles.com/?expert=Dennis_J_Haggerty
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