What is Accident, Sickness & Unemployment Cover?
Accident, Sickness & Unemployment (ASU) insurance is designed to cover a portion of your income if you’re employed but unable to work. It’s a type of Income Protection Insurance that pays you a tax-free proportion of your lost salary every month to help you cover living expenses until you’re back on your feet. It means you can still cover your mortgage and other bills if you develop illness or injury and are unable to work. When taking out an ASU insurance policy you’ll need to decide how much income protection you will need and you will pay a monthly premium to reflect this.
ASU cover potentially won’t pay out if you;
- Get sacked from your job,
- Quit voluntarily,
- Take out an ASU policy knowing you’re about to be made redundant,
- Have a pre-existing medical condition.
Types of ASU Cover:
You can choose either a short or long-term protection cover when taking out an ASU insurance policy. Each type has their own benefits.
Short-term cover
Short-term policies will cover your income for a set period of time. They can pay out up to 70% of your income on a monthly basis for a limited period – usually up to two years. While claim periods are limited, you can claim multiple times on your policy as long as you continue to pay your premiums.
Long-term cover
Long-term policies will cover your income right up until retirement age. They have no limit to your claim period, so you can continue receiving monthly benefits from your policy until you reach retirement age. However, long-term policies sometimes won’t include cover for unemployment.
