ASU Insurance explained

It is a sad fact that anyone can find themselves without income for reasons that are entirely beyond their control. Whether this is due to redundancy, long-term illness or an accident, the problems arising can prove to be a major cause of stress.

Accident Sickness and Unemployment insurance ( or “ASU” ) may provide cover against loss of income due to prolonged illness, accidents (occupational or otherwise) and traditional redundancy.

ASU policies will a tax free regular monthly income payments for up to 12-24 months, depending on the individual provider’s policy terms and conditions in the event of the policyholder becoming unable to work due to unemployment or incapacity.

These policies may offer significant peace of mind for many people, particularly those who have a total family income based heavily upon one person’s salary. If that person’s income is suddenly lost, then for some an ASU policy could make the difference between ‘coping’ and disaster.

As is frequently the case with insurance policies, the broadness and depth of the cover provided is often directly related to the cost of the premiums and there are large numbers of products and variations of cover available in the marketplace. In addition, as income payment protection policies can be high risk for insurance companies, they typically can be selective about who they sell these policies to and at what cost.

The combinations of circumstances here are too many to outline in detail but in general it may prove difficult to obtain these sorts of policies if there is

• An existing serious medical condition

• Participation in dangerous sports or pastimes

• Occupational work within a high-risk of injury environment

• A fragmented or incomplete work history

In such circumstances it may be possible to take out the policy but usually at the cost of significantly higher premiums, a reduction in the amount payable in the event of a claim, or the exclusion of certain aspects of the cover.

Most insurers will not accept claims in the event that the loss of income was intentional such as through resignation etc.

Typically with these types of policies, a claimant should anticipate a delay of some months before the first payment is made, typically 30-90 days after the covered event happens

As always, the policy details should be checked thoroughly before purchase to avoid surprises in the hopefully unlikely event of a claim.

It is also important to note that ASU policies should be kept up-to-date if circumstances change. A claim for loss of income due to (e.g.) a broken leg may not be well received if it transpires the accident occurred while parachuting – unless this had been originally declared when the policy was opened. Also with these policies it may well be obligatory to notify the insurance company should the nature of the policyholder’s occupation change.

In summary, ASU policies may be invaluable in helping protect an individual and their family against the unforeseen though care must be taken to ensure that the policy and cover selected is fit for purpose.

ASU policies may offer cover against loss of income due to a number of factors including sickness and accidents

• They can offer significant peace of mind

• The Insurance companies may impose some restraints on who can purchase an ASU policy or higher premiums for people in certain higher-risk circumstances.

• There may be a period of some months after a claim is lodged before any benefits are payable.