New redundancy insurance fills industry gap

MELBOURNE, Australia - June 1, 2015 - PRLog -- Income Security Founder and Principal Mr. Wally Ripper has announced the release of a new standalone insurance product to be marketed as Income Security Insurance to address the redundancy insurance gap that currently exists in the Australian risk protection marketplace.  The innovative product has been developed to help protect Australians against the financial stress and uncertainty that comes from losing a job.

ABS labour force data was analysed in a Weekend Australian article (April 25, 2015) and it revealed that a record 1.2 million Australian workers did not expect to be working with their current employer in a year’s time – and of those expecting to leave their job, 20% said they feared being made redundant.

“Involuntary unemployment can cause serious financial difficulties but there are few ways to protect against this.  Some loan protection insurance products cover loan repayments in the event of redundancy – but these payments are made direct to the lender”, said Ripper.

“How does an unemployed person pay for all their other bills and living expenses such as rent, electricity, gas, water, rates and school fees?  Income protection policies are designed primarily to protect against sickness or injury.  Where they include a redundancy benefit this is usually limited.”

Ripper said thenewly released Income Security Insurance product can be offered to existing clients who already have either an Income Protection policy or a Loan.  In addition, Income Security Insurance offers extended coverage for involuntary unemployment.  Monthly benefits are up to 85% of income with a maximum benefit available of $7,000.

The benefit is paid directly to the insured person so they can decide how the money is spent.  Cover periods of up to 3, 6 and 9 months are available.  There is a choice of waiting periods from 30, 60 or 90 days so that the cost of the cover can be reduced by opting for a longer waiting period if, for example, there are savings to draw on, or a large redundancy payout would be received.

A further key feature is an optional training benefit which reimburses the costs of retraining up to $2,500.

Ripper continued, “While there is a requirement that you already have an existing loan or income protection policy to apply for Income Security Insurance this can be from any provider”.

“Income Security Insurance does not have to be bundled with any particular insurer or lender’s product, so there is the flexibility to combine products to achieve the best coverage”.

Income Security Insurance can also be added to a client’s existing insurance portfolio to ensure that there is some cover for the risk of redundancy.

Most importantly, this means that redundancy is less likely to result in cancellation of other insurance policies or loan defaults.

The underwriter of Income Security Insurance is Avea Insurance Limited, a general insurance company with over 30 years’ experience in specialist insurances.  Ripper said that when working on the specifications of this product with Avea their aim was to ensure the product would be sustainable over the long term.  As a result not all occupations or industries/employers are eligible for the cover.  There is also a three month qualifying period before a claim can be made.

The quoting and application process is fully online so within 5 to 10 minutes eligible applicants can apply and pay for their cover on the dedicated Income Security Insurance website www.incomesecurityinsurance.com.au with no medicals and no paperwork.

The premiums are generally tax deductible like income protection and up to 3 years cover can be purchased in one transaction.

Job insecurity will continue to grow as more and more workers in vulnerable industries find themselves unemployed as the Australian economy adjusts and focuses away from previous large scale industries that were sources of employment such as manufacturing, mining, agriculture.

Even the white collar sectors are feeling stressed as technology, new work practices and overseas outsourcing impact on workers confidence and prospects for long term employment.

Ripper expects the current environment will result in professional services providers such as financial planners, insurance advisers, mortgage brokers, real estate agents, accountants, tax advisers, etc receiving enquiries about redundancy protection.  Income Security Insurance can provide an easily accessible solution when these enquiries and concerns are received.

Finally, another key advantage of Income Security Insurance is that can be of benefit to an adviser or broker from losing income from other products due to clawbacks when an Income Protection policy or Loan is terminated due to unemployment.

ENDS

Released by Income Security

Media Enquiries:          Mr. Joe Perri
        Joe Perri & Associates Pty Ltd
        Telephone / fax:          +61 3 9324 0362
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        Email:          jperri@joeperri.com.au