No one should rely on job security as redundancies happen and leave many individuals with little or nothing to fall back onto. Savings and redundancy money might not spread out very far if you have to service all your essential repayments with it. An income from the State while you search for work might not come anywhere near the income you relied on when it work. This again could mean you have a hug struggle to keep up with your repayments. Redundancy insurance by way of income, loan or mortgage cover could on the other hand supply an income that could be used as you did with your own income.
You would need to decide which type of insurance would be the most suitable based on your outgoings. You then need to choose the percentage of your monthly income or loan/mortgage repayments that you want to cover. There will be a limit on this amount so your provider would need to agree to the amount you choose to cover. This would be your replacement income should a claim have to be made on your chosen policy. There could be a deferment period of up to 30 days before a claim could be made with some providers. With others you might be unable to claim until day 60 and some others you could have a wait 90 days before you can claim. You might be eligible to claim your income for over 12 months or you might get 24 monthly payments before your cover ceases.
Redundancy insurance could be taken out by those who have mortgage repayments to maintain. In this case you would need to check out mortgage payment protection. The income from this type of policy could ensure you would be able to keep out of mortgage arrears. It is essential to stop out of arrears as if you fall behind on your repayments you could end up losing your home.
Loan protection could be taken should you have loan repayments to keep up with. This policy would help you to maintain secured or unsecured loan repayments which would both have consequences if you were to fall behind on repayments.
Income protection supplies a replacement income which you could use as your own and put it towards any outgoings that needed servicing while you looked for work.
While you can just take out redundancy insurance you might also want to consider the possibility of losing your income to incapacity too. Should you fall sick or suffer an accident and be unable to work you would then also be eligible to claim on the policy.
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