Universal credit and Critical illness payout

Arun171819

Hello Friends. I am about to receive critical illness payout of £36000 and i receive universal credit payment monthly. Once i receive the payment will my monthly UC payment stop? Do i have to inform DWP that i received the payment or will they come to know that i have received the payment. Secondly, i have credit balance of 7000 and 15000 loan from the bank.  If i pay the credit balance and loan in full, i'll be left with 14000. Will i be able to claim UC if pay the debts ?

DullGreyGuy

You can use payments from Protection insurance such as CI to repay debts without it being considered a deprivation of capital for the purposes of UC

HillStreetBlues

Arun171819 said:

Hello Friends. I am about to receive critical illness payout of £36000 and i receive universal credit payment monthly. Once i receive the payment will my monthly UC payment stop? Do i have to inform DWP that i received the payment or will they come to know that i have received the payment. Secondly, i have credit balance of 7000 and 15000 loan from the bank.  If i pay the credit balance and loan in full, i'll be left with 14000. Will i be able to claim UC if pay the debts ?

Yes, you need to inform them.
You would need to pay the debts in the same AP so bringing the total below £16k to stop UC from ending, you will need to inform UC the capital on last day of your AP.
If capital is over £16k at the end of AP then UC will end and once below £16k you can reclaim.

Arun171819

Will i have to provide them credit card and bank statement ?

HillStreetBlues

Arun171819 said:

Will i have to provide them credit card and bank statement ?

Yes with bank, and no with credit card.

Arun171819

as a disabled person(partial blind) can i put the insurance money in a trust like personal injury funds?

HillStreetBlues

Arun171819 said:

as a disabled person(partial blind) can i put the insurance money in a trust like personal injury funds?

In law it has to be "A payment received as consequence of a personal injury" So if an injury caused the partial blindness then it could be put into a Trust, if not then no.

xxxxxxxx

You can and should be asked for credit card statements if your bank account shows payments made to a credit card, then credit card statements should be asked for to prove the money has paid off the credit card debt,  otherwise you could load your credit card account(s) and still have more than £16,000. 

Better to send the credit card statements in with the bank statements to show the money has been spent.

Arun171819

Thank you everyone.