Mortgage/Income Protection and Job Seekers Allowance

wire1966

The AB1 forms are no longer in use at the local offices. When I needed them signed when I was on contributions based they told me that my insurance company are happy to get statements instead which to be fair they have accepted

How can I sign on if I don't get IB JSA

Kind Regards

carebear13

you still sign to get credits,just not the money and to keep your paperwork uptodate for the insurance company so you can still get your payments.

wire1966

Thank you for that

So what proof do I send the insurance company apart from the job search activity

Linda32

Hi,

You will get a final letter from the DWP saying that they can no longer pay you JSA as the six months is up. I think from memory they word it as a total amount and a number of days.

This will be excepted by your insurance company. In my experience the insurance companies and the DWP seem to work hand-in-hand in as much as the Insurance know how the DWP work.

You will have your job search diary which will be signed by the JC when you sign on, this will be enough proof I'm sure. Plus the copies of your applications/letters etc.

HTH and Best of luck

Oh and I've just remembered I just kept sending a copy of the little green book you get, the one which you have to hand in when you sign. I know it only has the first two dates of signing on, but my insurance company accepted that. They do know that you don't keep on getting new appointment books.

Uvavu04

There are many questions concerning this on the forum, and I wanted to advise of circumstances in which it actually could pay off to have it.

If you follow this whole thread so far you'll see that some people have been dismayed to discover that it is not worthwhile for them to have income protection insurance if they would essentially forfeit their income-based JSA.

One way of testing the water when considering taking out income protection insurance is to go to the Directgov website to look at your benefits entitlements in different scenarios: 'Benefits Advisor'.

This is a very good way of predicting entitlements that enables you to change the scenarios with a "what if?" function (e.g. - enabling you to check what would happen if your savings were less or more, and if you received a monthly sum of money from the income protection insurance).

The rule is that if you have £6000 in savings or more and have previously claimed the 6 month entitlement to contribution-based JSA (which is completely independent of your savings - an automatic entitlement if you have worked for at least two years and not already claimed this benefit during that time), your entitlement is going to be fairly minimal. This is because, with £6000 or more, your entitlement will then be pro-rated rather than the full benefit. And if you have more than £16,000 in savings - the upper threshold - you will be completely ineligible for income-based JSA and Council Tax reduction.

Obviously, JSA entitlement calculations vary from person to person, taking into a range of circumstances - see the Benefits Advisor site and play around with the 'What if?' function to see how things vary. But for simplicity's sake, I am putting myself through the test for you, here -

I am single, in my mid-thirties, living alone, renting, and have been made redundant from work with a settlement of *over £16,000* because I worked for my employer for around 10 years. I have nearly used up my contribution based JSA, with only one month to go before I am no longer eligible to claim it (you can claim this for a maximum of 6 months).

Because I received a payout of over £16k, this takes me over the basic threshold that would have allowed me income-based JSA entitlement. So, I am not entitled to ANY state benefit payments (income-based JSA or Council Tax reduction, other than being a single occupant) - not even a means-tested proportion of the income-based JSA. According to the DWP, I am expected to use up the best part of my redundancy payout before I can then try to claim any benefits.

If on the other hand I had less than £6000 in savings from my payout, I'd be eligible for only £85.55 per week, or £4,4860 per year, so the Benefits Advisor says. While it's nothing to scoff at, the full entitlement is not in fact that much! And if I alternatively had just under 16K, leaving me just below the upper threshold, my benefit would be half that amount still, according to the calculations.

This is where income protection insurance has come in handy. My situation is that because I'd have received nothing in income-based JSA (or very little when part of it dried up, and a modest sum when I could eventually claim the full amount) I am almost three times better off with income protection insurance than I would have been with the full benefit entitlement, having an insurance benefit of £1000 per month, each month, for up to one year should I need it. £12,000 isn't a huge amount of money, but it is still much better than what I'd otherwise have had. Had I not taken out the policy, I'd have been eligible for no income-based JSA and so would then immediately start using up my redundancy payout, which would have been a shame (a foot on the housing ladder, and the need for a deposit, being a strong consideration for me).

Naturally, though, you need to check the small-print with insurers and consider your own circumstances. For example, you may run into difficulties if you're self-employed; if your department at work is already undergoing restructuring; if you don't meet the minimum no-claims period from the insurance company; if you are sacked/dismissed; or if you take voluntary redundancy. [There is bound to be another thread elsewhere which deals with criteria concerning income protection insurance - not something for me to detail here.]

If you know your employer will offer you a sizeable payout for redundancy (say, if you are part of the Civil Service Compensation Scheme, you can actually check with their calculator online before your redundancy is even on the cards. Alternatively you could ask your HR department), then it is absolutely worth taking out this insurance, bearing in mind my own benefits scenario.

It's important to consider how much money each month you would _need_ in order for the income protection insurance benefit to be worthwhile. Naturally, what you pay in to the scheme each month will affect the amount you can then regularly claim: in my case I paid a premium of £40 each month for the maximum benefit of £1000 per month for a year. You can can usually opt for £1000 or £1500 (depending on the policy) or for a benefit of half your monthly salary - whichever is the lesser will decide on the monthly benefit.

I realised it wouldn't have been worth taking out insurance if I'd had little to no savings and my benefits entitlements amounted to the same sum each month (the problem of paying into a scheme unnecessarily, actually losing you money). So, it's essential to do the calculations with the Benefits Advisor website, factoring in the likely monthly benefit you'd receive from income protection insurance and comparing that with basic state benefit entitlements.

Lastly - not meaning to sound boring but...it is important to remember that JSA and Council Tax benefits are for people who strictly speaking need them. Having your cake and eating it isn't always possible when an employer settlement has been made and you also claim income protection insurance. Feeling that you also have a 'right like everyone else' to claim the minima of income-based JSA entitlement isn't the best attitude if your insurance gives you far more of a benefit than you could claim from the state anyway; arguably in such circumstances it's best to 'let it go'.

PS -this is my first ever post. Please forgive me for any protocol slips, etc.

Uvavu04

PS - I should also add - though it may go without saying - that when the state benefit is potentially greater than the income protection benefit, you may just have to let the latter go (as much as that's irritating to have to accept). An earlier post mentioning a man's monthly £250 income protection benefit demonstrates that he'd be better off not claiming it at all when he would otherwise receive a reasonable sick pay and help towards various costs (sorry if I'm pointing out the obvious!).

Mr_fish

Hi there. I'm a newbie here so please go easy..

I have a MPPI policy and found out last week that I am likely to be made redundant in the next few months, subject to a mandatory 30-day consultation period. Naturally have been busy researching and calculating my entitlements to JSA taking into account my insurance.

Concerning the issue of MPPI lowering the entitlement to JSA which understandably people are angry about, my search lead me to the DWP's Decision-Maker's Guide Vol.5 Chapter 28 (google 'dmg vol 5' and scroll down) which concerns the classification and treatment of income. I was particularly interested in pages 53-58 which appears to confirm that the payout from a MPPI policy claim should NOT be included as income in the calculation of the amount of JSA payable.

Previously I had tried Citizens Advice (who were hopeless) but am a while away from (probably) being made redundant and signing on myself, but I thought it well worth a share and to see if there are any thoughts on this. I hope this is the holy grail I have been looking for!