Redundancy Insurance is a form of Income Protection Key Man Insurance
where, if you are made redundant a percentage of your usual income will be paid to you until the payments reach the terms of your policy or you secure another job.
Redundancy Insurance differs from Income Protection Insurance as with the latter your usual income is protected if you so happen to be injured or fall ill.
Many regard Income Protection Insurance as having greater value but comparing the two insurance types is a bit like comparing apples to oranges.
Just the same each type of insurance has a definite place in the Life Insurance Quotes and it is ultimately up to the prospective consumer to study all policy types and different types of income insurance and decide which is the best fit for his or her situation.
So how does Redundancy Insurance work?
This type of insurance is one of the least understood insurance types and it probably one of the newest offered by insurance companies.Redundancy effectively insures a portion of your income, (generally 75%) in the case you become redundant at your place of work.
Keep in mind if you are offered a redundancy package and your package is voluntary your are not entitled to claim on your insurance policy. Also if you have been dismissed from your workplace that is not classed as being made redundant and your policy will not pay out.
How long will this type of cover pay after I am made redundant?
Usually policy's pay for twelve months but you probably will have to provide your insurance company proof that you are actively looking for work.
You can arrange a policy which will pay you up to 24 months after being made redundant although usually such a policy will come at a premium and I would question the value of such a policy.
You may also find that some whole life insurance policies will only cover you for 6 months and this may prove more practical as the premiums are more reasonable.
How much are premiums for this type of insurance?
Premiums can vary greatly from insurer to insurer and it can be difficult to compare one policy to another on price alone as no two policies will be similar.
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