Ask LH: Can I Get Income Protection Insurance If I’m About To Be Made Redundant?

Dear Lifehacker, My company in the food manufacturing industry is shutting down indefinitely toward the end of 2014, and I will be made redundant. Are there any options for income protection insurance for me? Will they cover someone whose (rather large and well-known) company is closing, if I apply for one now? Thanks, Unprotected

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Dear Unprotected,

We hate to break it to you, but we suspect you may be out of luck. Income insurance providers aren’t charities — they’re obviously not too keen on accepting members who are guaranteed to make a claim soon after joining. Unfortunately, your duty of care towards an insurer includes disclosing all relevant information, and your employer going bust falls into that category. So the odds are definitely stacked against you.

If it’s any consolation, the vast majority of income insurance policies wouldn’t provide you with much assistance anyway. Redundancy cover is fairly limited in Australia. It’s generally only offered as a premium/add-on to income protection policies that cover events like illness and injury. In most cases, adding the redundancy feature merely excuses you from paying your premiums for a few months and does not include any benefit payments. In other words, redundancy insurance probably isn’t the answer you’re looking for.

It sounds like you still have a few months to get your affairs in order, which is vastly preferable to the typical two or three weeks’ notice that most people get. Our advice it to start saving as much as possible — setting up an emergency fund is a good place to start. Also dust off your resume and have a good, hard think about changing careers. I know it sounds like an empty platitude, but being made redundant really can be a blessing in surprise. Good luck!

See also: Top 9 Ways To Get A Better Job | Ask LH: How Should I Deal With Being Made Redundant? | How Can I Find A Job After Being Fired? | This Model Resume Will Help You Score Your Dream Job | Top 10 Tips For Acing Your Next Job Interview


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