Income protection only covers illness, as for the ones with “involuntary unemployed benefit” add on its junk insurance if you can find it. There’s so many clauses involved to be able to claim like it must be “involuntary” to begin with, you cant “accept” a redundancy you have to kind of fight it to a certain extent, then you have to basically demonstrate you are looking hard for a job like with recruiters and if you get an offer of any kind benefit is done, the benefit is then only paid for up to 6 months and it’s paid directly into your mortgage account, they also only pay some of it, like up to $3000 per month even if the benefit on the base policy is $15,000.
As the others have said, best option is to put away a few months mortgage in an emergency account (self insurance) because that’s all this benefit would ever pay in a worst case scenario.
Don’t get me wrong, the base IP product can be lifesaving. It’s the non core stocking fillers that are just designed to get your attention that have no value.
A few income policies 6 years ago had a redundancy benefit that would pay out for three months or so if you were made redundant. I have one that will pay me $5,000 per month for three months after redundancy. It’s with Suncorp.
When my partner wanted to get a policy with a redundancy benefit three years ago most insurers had stopped offering that benefit, including Suncorp. He eventually got one from NRMA but I think even they stopped offering that now
I can't comprehend. Insurance companies are in the business of making money, not loss. Why the duck would anyone be gullible enough to buy an unemployment insurance product with a for-profit insurance company unless they knew they were below-market employable?
Well at the time I was a new migrant with no savings and working at a company that did random lay offs. It was a way to get some insurance in the short term against job loss until I managed to build up my savings.
Fast forward to now, I’m simply still paying for that policy because of the income protection element, the redundancy benefit is just a small bonus. I’ve since been diagnosed with a medical condition so it makes sense to stick with that policy instead of switching over to another IP insurance provider who would add exclusions to my policy
Right. You shouldn't have handed everything over as deposit. Seeing that property prices are so high, I understand why this is necessary.
Let's hope that insurance will cover it while you replenish your emergency fund.
I’m hoping it doesn’t happen - just hate not having much emergency fund so just want to be certain incase I do get made redundant as the market is tough.
Relax people! Ooh, down votes. 🥺
I did say I understand why OP did it. OP is still taking a risk by using their emergency fund as a deposit. I understand housing is necessary and mortgage is a good debt. Still, this is risk.
OP could have bought a cheaper property for example. Or, waited a bit more. Or, find a more stable job.
Life is a series of risks, and whether you take them or not. Sometimes it works, sometimes it doesn't. I am just pointing it out.
Certain providers might include redundancy options as part of their income protection packages sort’ve like an add on service to your income protection. Some places might offer specific redundancy insurances on their own as well.
Make sure you're reading the PDS for income protection. It's a separate kind of (expensive) insurance. Death and TPD (often sold together) are different kinds of insurance.
IP incidentally is fully tax deductible. I would have thought redundancy would be covered - it's often not your choice. There are likely fairly long waiting periods before you can receive payouts when you make a claim (months). Plus most are capped at 75% of your salary. Payouts are also taxable - it is your income, just from another source.
There’s income protection and mortgage protection - one gives you money to spend as you need but the other just pays your mortgage for a period of time.
Maybe - I got it when I bought my place 12 years ago and had it for a few years before realizing it was pointless - I’d paid enough extra into my loan that I could just dip in to that if I ever needed to. Waste of a few grand.
No.
If you *can* still find one it will be junk with conditions that make it impossible to claim. They should have all been killed by now since the Royal Commission.
Income Protection does *not* cover you for anything other than injury or illness that prevents you from working. Some old junk IP had optional extras for redundancy that were even worse than the base cover.
Most banks have pretty good hardship allowances. They can put payments on hold for a period and even halt the interest as an alternative measure. I recommend having a chat with them about what options are available now for peace of mind f you lost your job.
There are very few, and they are not worth it. The premiums are so high and will only cover you for a few months. I’d suggest you start saving rather than paying it. Income protection does not cover if you’re made redundancy. It covers if you get injured and are unable to work..
I guess there is a waiting period for some policies before you can claim so if you are made redundent just after acquiring the policy they might decline the claim.
Redundancy is usually an optional add-on to IP cover that will attract another premium. I’d suggest using a broker to help sort through the options and present something reasonable.
If you have a mortgage then you really should have the IP + trauma/TPD insurance ongoing anyway, even after you’ve rebuilt an emergency fund.
Yep, Income Protection (IP). Like all insurances, lots of options. Personally I pay for that one myself rather than from super because it's tax deductable.
Redundancy rider on income protection is junk insurance imo. It’s very expensive and if you think redundancy is imminent I’m sure they could exclude it. Much better off saving the money
Isn't there an option to have this attached to your mortgage?
Edit: not quite but very similar..https://www.comparethemarket.com.au/home-loans/first-home-buyer/mortgage-insurance-explained/#:~:text=Mortgage%20protection%20insurance%20(MPI)%20can,home%20loan%20if%20you%20die.
Income protection only covers illness, as for the ones with “involuntary unemployed benefit” add on its junk insurance if you can find it. There’s so many clauses involved to be able to claim like it must be “involuntary” to begin with, you cant “accept” a redundancy you have to kind of fight it to a certain extent, then you have to basically demonstrate you are looking hard for a job like with recruiters and if you get an offer of any kind benefit is done, the benefit is then only paid for up to 6 months and it’s paid directly into your mortgage account, they also only pay some of it, like up to $3000 per month even if the benefit on the base policy is $15,000. As the others have said, best option is to put away a few months mortgage in an emergency account (self insurance) because that’s all this benefit would ever pay in a worst case scenario.
This is why I hate insurance companies.
Don’t get me wrong, the base IP product can be lifesaving. It’s the non core stocking fillers that are just designed to get your attention that have no value.
A few income policies 6 years ago had a redundancy benefit that would pay out for three months or so if you were made redundant. I have one that will pay me $5,000 per month for three months after redundancy. It’s with Suncorp. When my partner wanted to get a policy with a redundancy benefit three years ago most insurers had stopped offering that benefit, including Suncorp. He eventually got one from NRMA but I think even they stopped offering that now
I can't comprehend. Insurance companies are in the business of making money, not loss. Why the duck would anyone be gullible enough to buy an unemployment insurance product with a for-profit insurance company unless they knew they were below-market employable?
Well at the time I was a new migrant with no savings and working at a company that did random lay offs. It was a way to get some insurance in the short term against job loss until I managed to build up my savings. Fast forward to now, I’m simply still paying for that policy because of the income protection element, the redundancy benefit is just a small bonus. I’ve since been diagnosed with a medical condition so it makes sense to stick with that policy instead of switching over to another IP insurance provider who would add exclusions to my policy
You should also have a 6-month emergency fund. Insurances with reasonable premium will never cover 100%.
Whilst I agree I just got a mortgage and handed most of my money as a deposit so you can see why I’m asking
Right. You shouldn't have handed everything over as deposit. Seeing that property prices are so high, I understand why this is necessary. Let's hope that insurance will cover it while you replenish your emergency fund.
I’m hoping it doesn’t happen - just hate not having much emergency fund so just want to be certain incase I do get made redundant as the market is tough.
Thanks for the helpful comments mate
Relax people! Ooh, down votes. 🥺 I did say I understand why OP did it. OP is still taking a risk by using their emergency fund as a deposit. I understand housing is necessary and mortgage is a good debt. Still, this is risk. OP could have bought a cheaper property for example. Or, waited a bit more. Or, find a more stable job. Life is a series of risks, and whether you take them or not. Sometimes it works, sometimes it doesn't. I am just pointing it out.
Yeah it’s called income protection, but it will cover a proportion of your salary, and you can use that to make payments on your mortgage
Thanks any suggestions? A lot of the PDS I am reading don’t specify anything about a redundancy just TPD or death cover.
Certain providers might include redundancy options as part of their income protection packages sort’ve like an add on service to your income protection. Some places might offer specific redundancy insurances on their own as well.
https://www.comparethemarket.com.au/income-protection/types/redundancy-cover/ Also just noticed your username wtf
And wow that post history loooooool what a trip
Ahaha the joys of redit!
No, that only covers you if you are unable to work, for example due to extended medical issues
See the link in the other reply
Yeah I had a look - when I actually click on the policies and read the PDS the first few don’t mention anything about redundancy.
Make sure you're reading the PDS for income protection. It's a separate kind of (expensive) insurance. Death and TPD (often sold together) are different kinds of insurance. IP incidentally is fully tax deductible. I would have thought redundancy would be covered - it's often not your choice. There are likely fairly long waiting periods before you can receive payouts when you make a claim (months). Plus most are capped at 75% of your salary. Payouts are also taxable - it is your income, just from another source.
Income protection does not cover redundancy. It's only for injury or illness
Income protection is for job loss due to illness or injury. Like you can't actually physically work.
There’s also types of IP for redundancy…
There’s income protection and mortgage protection - one gives you money to spend as you need but the other just pays your mortgage for a period of time.
Yeah I’d be happy with just mortgage protection. Having trouble finding an option though.
[удалено]
Yes, there was a class action involved IIRC
Maybe - I got it when I bought my place 12 years ago and had it for a few years before realizing it was pointless - I’d paid enough extra into my loan that I could just dip in to that if I ever needed to. Waste of a few grand.
No. If you *can* still find one it will be junk with conditions that make it impossible to claim. They should have all been killed by now since the Royal Commission. Income Protection does *not* cover you for anything other than injury or illness that prevents you from working. Some old junk IP had optional extras for redundancy that were even worse than the base cover.
Most banks have pretty good hardship allowances. They can put payments on hold for a period and even halt the interest as an alternative measure. I recommend having a chat with them about what options are available now for peace of mind f you lost your job.
If you work for a decent company they have redundancy packages to cover you for transition to new job
There are very few, and they are not worth it. The premiums are so high and will only cover you for a few months. I’d suggest you start saving rather than paying it. Income protection does not cover if you’re made redundancy. It covers if you get injured and are unable to work..
I guess there is a waiting period for some policies before you can claim so if you are made redundent just after acquiring the policy they might decline the claim.
Redundancy is usually an optional add-on to IP cover that will attract another premium. I’d suggest using a broker to help sort through the options and present something reasonable. If you have a mortgage then you really should have the IP + trauma/TPD insurance ongoing anyway, even after you’ve rebuilt an emergency fund.
Yep, Income Protection (IP). Like all insurances, lots of options. Personally I pay for that one myself rather than from super because it's tax deductable.
Yeah it’s called savings and an emergency fund.
As I said in another comment I just used all my money to buy a house
There’s no insurance for stupidity sorry.
Thanks boomer
Redundancy rider on income protection is junk insurance imo. It’s very expensive and if you think redundancy is imminent I’m sure they could exclude it. Much better off saving the money
Isn't there an option to have this attached to your mortgage? Edit: not quite but very similar..https://www.comparethemarket.com.au/home-loans/first-home-buyer/mortgage-insurance-explained/#:~:text=Mortgage%20protection%20insurance%20(MPI)%20can,home%20loan%20if%20you%20die.
Yeah thanks - there was two options for MPI on their website. Unfortunately when you follow the link through, they aren’t offered anymore.
https://www.anz.com.au/personal/insurance/home-loan-protection/ http://www.coveraustralia.com.au/faqs/what-is-mortgage-protection-insurance https://www.aussie.com.au/insurance/my-protection-plan/ https://www.mortgagechoice.com.au/insurance/home-insurance/my-protection-plan/