What is an ASU policy likely to cover?
ASU is designed to provide you with financial protection in the event you are unable to continue working because:
• You have lost your job through no fault of your own;
• You become ill and are too sick to work;
• You are injured and unable to work.
You will typically receive a proportion of your income for up to 12 months which can then be used to help cover your monthly outgoings.
What is unlikely to be covered by ASU insurance?
As with any form of insurance, when you buy an ASU policy it’s important to find out whether any exclusions apply to your cover.
First and foremost, if you have any reason to suspect that you might be about to lose your job it is vital to be aware that any ASU policy you buy may be invalid.
Insurance companies are careful to investigate customers’ circumstances before authorising payouts, and if it seems that you have deliberately tried to insure yourself in anticipation of redundancy you will probably find it impossible to claim.
Most ASU policies come with a waiting period designed to prevent fraudulent claims. This might mean that if you are unable to work within a few months of taking out an ASU policy you won’t be eligible for a payout, even if you were 100% honest with your insurer when setting up your cover.
If you are able to make an ASU claim, it’s likely you will have to wait at least a month before receiving a payout. The waiting period that comes with your policy is something else to look out for when researching the products on offer from different ASU providers.
ASU policies also tend to be time limited - so you might find that any payouts you are entitled to under your policy will cease after 12 months.
Meanwhile, if you are aged over 65, are self-employed or have been in your job less than six months, you may also find that it’s harder to buy ASU cover.
Finally, don’t forget to find out which medical conditions are limited or excluded under any ASU policy you might take out.
It isn’t unusual for back problems and conditions such as stress to be excluded, and these are among the most common causes of absence from the workplace. Pre-existing medical conditions will also be excluded from your cover, and you’ll be required to declare these when taking out your ASU policy.
How can I cut the cost of an ASU insurance policy?
The best way to make sure you get good value for money when buying ASU is to compare a range of insurance policies from different providers. You’ll be able to look at how much each policy costs, as well as what it covers, before making a decision.
MoneySuperMarket’s income protection insurance comparison channel is an ideal place to start your research.