ESA and WRAC Deductions from Income Protection Insurance Payments

yalfoom

I have been off work for 2.5 years and have been receiving PHI payments for 2 years through a policy my employers set up for all employees. In my contract, it states I should receive 75% of my salary. When I received my first payments, I noticed I was getting less than I should have; as if I was being taxed twice. When I mentioned this to HR, they said I need to take this up with HMRC. Over a year later, they tell me that the insurer is deducting ESA and WRAC (for which I am yet to be assessed). I proceeded to make a claim for these elements; I received ESA (contributions based) for 1 year, and reapplied last month only to be told that I will no longer receive ESA as my income (PHI insurance) is too high. Therefore I have only received 1 year of ESA out of 2 years of deductions, and I haven't even touched on WRAC.

I know my employers are culpable for not letting me know in good time about these deductions (I will be taking this up with them), but I would like to know if these deductions being made by the insurer are legal. And where this money is going. Anyone who I have spoken to at DWP have never heard of these deductions being made, and doubt whether they receive payment for these deductions.

I have spoken to CAB, but they said they want to see the insurance policy document before they can provide any advice - I have asked my employers on many occasions for the policy document, but they say they have provided all information that they have been given (which is very little).

Also, my employer is starting to talk about terminating my contract.

Could anyone please provide any advice on this, as wherever I turn (employer, DWP) I get no help whatsoever?

Many thanks

KxMx

To clarify you claimed CB ESA and have not yet been placed into a group?

ESA CB is time limited to 365 days unless you are in the Support Group.

Your last sentence of the first paragraph doesn't apply as CB ESA is strictly time limited to 365 days unless in the Support Group.

The alternative to CB ESA is IR ESA which is means tested and you've failed the means test.

I'm no expert but perhaps the PHI pays 75% of salary minus any state benefits? Perhaps the terms mean you cannot have both/they don't have to pay the full amount if already geting ESA.

Two suggestions: if your PHI policy is terminated then I'm assuming you would pass the means test for ESA IR. If you are single and have no other income. Generally a working partner will also result in failing the means test.

You could try chasing up your ESA medical assessment: chase the DWP, Maximums and write to your MP. Do you feel you meet a Support Group descriptior? If the outcome of your medical results in a SG placement your CB ESA would become payable again.

Have you thought about getting professional advice from a solicitor as none of the usual agencies have been able to help re PHI?

Emmylou_2

Unum Group Income Protection policy?

I had this. I was initially in the WRAG - had the ESA amount deducted from my PHI (which paid 75% salary less state benefit) but then had a deduction from my ESA of pretty much 100% (I would receive £40 per month) because of the income from PHI being classed as an "ill health pension" - even though I was still paying PAYE Income Tax and NI on this.

I argued the case with work.
I argued the case with Unum.
I argued the case with the DWP.

I lost on all three counts.

I then was reassessed, put into the Support Group, and offered a lump sum payment to end my employment (which I took). I now get the whole amount of CB ESA.

yalfoom

KxMx: Thanks for your reply.

I have received CB ESA for 1 year and applied again for ESA, but was turned down due to having too high an income. I am - and have been - paying NI and PAYE on the insurance payment.

My employers are a waste of time, as they don't know what the full benefits of the policy are. They didn't even know that these deductions were taking place, after I mentioned to them that I was receiving a lot less than I should have been.

My question is where is this deducted money going? Is it another form of commission for the insurance company? I don't see the point in deducting these amounts only for someone to claim them back. DWP have never heard of these deductions, and also wonder where this money goes.

I am still awaiting a WRAG assessment; I tried asking when my appointment will be, but was told there was a huge backlog due to a change in medical services provider.

Would I qualify for legal aid if I was to approach a solicitor for advice on this? I really cannot afford legal fees.

yalfoom

Emmylou: thanks for your reply.

If you don't mind me asking, what sort of pay off did you get? Was it a multiple of your salary? I'll more than likely have my contract terminated soon, so I'd like to have an idea of what to expect.

Do you know if would be worth applying for personal independence payments?

[Deleted User]

Re:PIP do you have care or mobility issues?you need to have a good read up on PIP info all over the internet

adviceforall

I have gone through this as well. On sick leave and receiving PHI from my employers. The amount i was being paid suddenly changed and when I enquired got told the same as you that they were deducting ESA amount from my money. As i hadn't known I could claim this I had to put in an application . That was in April this year, it was back dated for 3 months ( to Jan) so im nearing the 1 yr. I did have a assessment date, I travelled nearly an hour to get their, struggled to find parking and then walk to the centre, got there only to be told oh we have to reschedule your appointment as we are Drs short, To say I wasn't impressed was an understatement...Now several weeks later im still waiting for another appointment. I believe the money should go up after a period of time, which I have passed ages ago..I still have the stress of finding out what group I get put in to see if I will carry on receiving ESA after Jan 16.....

nannytone_2

you are paaid ESA assessment rate until you are put into a group.
if your claim is successful, the additional amounts ( WRAG or support group components) will be backdated to the beginning of the 14th week

adviceforall

Is there a time scale in which the assessment should be carried out?

nannytone_2

ideally, it is done at the 13 week stage, but as you have found out,m there are massive backlogs in some areas.
you should contact your MP as they are quite good at hurrying things aloing

Emmylou_2

@yalfoom: I was paid a sum more or less equal to four years (full time) salary, tax free. I would definitely apply for PIP (I am currently going through the DLA to PIP transfer. It's not pleasant but it needs to be done)

@adviceforall: It *should* be near the 13 week point. Mine was 70 weeks (and three cancelled/aborted assessments) from the start of my claim, and then another three weeks to decision.