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Legal matters

Redundancy insurance

4 replies

balia · 06/06/2013 22:24

DH's lovely DF has been made redundant. The firm he worked for has gone bust so at the moment it isn't certain if he will get any redundancy pay; he hasn't been paid for last month's work, either.

The benefits people have told him that because of his age (he would be retirement age in 8 months), they will be putting him on Pension credit (?).

About 3 years ago, PIL's were having a difficult time financially due to MIL's poor health. They took advice from a financial advisor and made some changes. They also took out an insurance policy to cover the mortgage if FIL was made redundant.

Today the insurance company have said they won't pay out unless FIL gets Jobseekers allowance and sends them evidence every month of the efforts he has made to seek work. The original paperwork has no mention of this clause. They've also said that unless FIL sends in the claim form with all the correct paperwork, the insurance will be void anyway.

Can this be right? PIL's are in a total state. They are going to get legal advice but have no money (obvs) and are panic-stricken that they will be homeless.

OP posts:
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mikkii · 07/06/2013 22:08

The best thing would seem to be for him to go to the job centre with his policy, tell the job centre that he wants to look for work and in the meantime he requires their assistance with his insurance claim.

If they don't help, go to the Citizens Advice Bureau, you can usually find one locally.

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Alanna1 · 07/06/2013 22:17

I agree with mikkii. Also have a look at their home insurance - some people have legal expenses insurance. Good luck.

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lymeregis · 07/06/2013 22:19

Ask the insurer to justify with reference to the policy and its clauses. There is an ombudsman they can complain to if they are not happy.

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flowery · 08/06/2013 09:50

Well I would have expected redundancy insurance to require the person to actively look for work, I think that's pretty standard, otherwise they could end up paying someone's mortgage indefinitely unless its for a defined period of time. And obviously the form needs to be filled in and appropriate paperwork received.

But if the terms and conditions of the policy don't require the person to look for work they can't impose that condition after the event, that doesn't seem fair at all.

I would write to the insurers asking them to point to the clause in their terms and conditions that state they will not pay out unless the person is actively seeking work, and if they can't, use their complaints procedure and the ombudsman.

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