Job Redundancy looming.. Home loan repayment cover advice please!

prabh on 17/04/2014 - 12:05
Last edited 17/04/2014 - 12:43

Hi all,

My company is being dissolved and they are absorbing some of the staff in the parent companies. My employer has announced that they will be making some people redundant from my team, and I have heard from sources that I may be one of them.

If i get made redundant, the date last date at work would be 1st July, 2014.

I have called my bank and took out loan repayment protection insurance today. When I asked about waiting periods, the lady on the phone actually asked if something had happened at work, I said no.

There is a 3 month waiting period on the policy before I can make an involuntary redundancy claim. But I did categorically ask her if that means that I need to be working for three months after taking out the policy and she said no, it means you can make the claim three months after taking out policy (hope that makes sense).

But she also said that banks do investigate if people take out policy today and get made redundant tomorrow. In my case if I am made redundant (if so hopefully) that would be around 1st July, so still have 2.5ish months.

You think I would be ok to make a claim after 3 months or can you guys please suggest some income/loan repayment protection policies that have a lesser waiting period so I am not frowned upon when making a claim?

Thanks in advance, pray for me guys!

Financial

Comments

  • prabh on 17/04/2014 - 12:33

    Anyone guys?

    • bbqwer on 17/04/2014 - 12:59
      -3

      You are doomed!

  • rack on 17/04/2014 - 13:01

    They will investigate. Contact your employer and seek information as to when employees were officially (in written) advised that redundancies are in plan.

    • prabh on 17/04/2014 - 13:26

      But then, they have only told us:
      1. We would like to absorb as many of you possible into the parent companies.
      2. If you don't get an offer from either of them, or we can't offer you a comparable role, you will be made redundant with last working day being 1st July, 2014.

      That does NOT mean that I have been informed about being made redundant. That would only officially happen when I have a written letter saying "sorry you are being made redundant and your last working day would be XYZ"

      Correct me if I am wrong please

      • ESEMCE on 17/04/2014 - 15:42
        +2

        Agreed, but they might annul the contract based on the point that you "lied" to them when the sales rep "asked if something had happened at work".
        As others have said, the PDS will identify what you're required to tell them.

      • rack on 17/04/2014 - 16:51

        Have they sent out emails or memos etc of the possible looming redundancy or has it just been a verbal announcement. If only verbal i wouldn't be too worried about it.

  • pjetson on 17/04/2014 - 13:02
    +2

    You need to look at the Product Disclosure Statement (PDS) for your policy to see what the actual policy says, rather than what someone tells you on the phone. You will be able to get this from your bank, and probably from their web site. I just checked out a similar policy from Westpac, and it seems to be broadly the same as what you've described above, but do I question the "it means you can make the claim three months after taking out policy" advice you got. It may be true, but only the PDS can really tell you.

  • Malarkey on 17/04/2014 - 13:44
    +3

    I'm assuming if you do get made redundant that you will get some kind of pay out? Why not be pro active and if you have a feeling that you will be gone why not start looking for jobs in early June and try to transition into a new job straight after being made redundant.

    That way you continue a flow of income plus whatever lump sum you receive from your old job. Think of it in a positive way, at the moment your talking like you are going to be fired and not have another job lined up, it's up to you to do the leg work and secure that next job.

    • prabh on 17/04/2014 - 14:24
      +1

      I have already started looking mate, just covering all bases really!

      • Malarkey on 17/04/2014 - 14:48
        +1

        That's the way! Sorry it just sounded like you were waiting for it to happen :) good luck with it all man, it never hurts to have the insurance just in case.

  • ianyelts on 17/04/2014 - 15:43

    Free money:

    http://employment.gov.au/general-employee-entitlements-and-r…

    Call:

    1300-135-040

    24 hours a day, 7 days a week.

    • hazzad on 18/04/2014 - 08:40
      +1

      That's only if a company Can't pay employee entitlements. There's no indication of this from the OP. Technically I think you should be fine Anyway. There has been no announcement officially made. Your simply taking out cover based on heresay. I Don't think they have grounds for annulling the cover. Better still Hopefully you find work get your payout and not have to use the cover. Which Will mean money in your pocket.

  • kwaker on 18/04/2014 - 09:33
    +1

    insurance isn't just for when you know you need it, if you don't account for financial burdens that you will encounter you should have continuous cover. ozbargain recently had a post about dentists where someone asked if they could take out health insurance to do an expensive procedure and cancel straight after: get real they are not a charity and they are not stupid. don't act like they aren't being fair when your trying to rort them.

    however with your case you can try it but disclose what you have formally been told or what is public knowledge as they can only accuse you of the papertrail they can find on you. if its heresay then its exactly that. just check the pds and since its a little bit shifty what your doing you could have your solicitor oversee.

  • hazzad on 18/04/2014 - 09:43
    +1

    Everything else aside, I would have thought that as long as you wait out your waiting period what can they say? Is there some law against taking out insurance policies when you know you might need it? Would have assumed that's why they specify waiting periods.

    • kwaker on 18/04/2014 - 10:28

      exactly, but just don't lie

      I remember reading something on the internet once about a man who insured cigars and claimed they were destroyed in a series of small fires (obviously he smoked them). he won the court case because it was insured for fire and when he went to withdraw the money he was arrested with intentionally destroying insured goods or something. lol

    • Geewhizz on 20/04/2014 - 07:20
      +1

      Everything else aside, I would have thought that as long as you wait out your waiting period what can they say? Is there some law against taking out insurance policies when you know you might need it?

      It's called 'insurance' not 'assurance'in which case the premiums would be significantly higher.

      OP you're treading a fine line - the bank may well (is likely to) reject your claim, and if they don't, if further investigations by them reveal that you did know about this but said you didn't they could have you charged you with fraud, which would have long-term repercussions for you.

      Geekomatic makes a good point.

      https://www.ozbargain.com.au/node/140819#comment-1944692

  • belzecue on 18/04/2014 - 12:20
    +2

    That's a sucky position to be in, and I hope things turn out for you better than it looks.

    I do wonder about why you would post your situation here, a public forum, if you know they'll be investigating. If they find this post, I expect they could use it to prove you took out the policy in bad faith by not declaring you knew it was likely you'd be made redundant. Just seems like a risky thing to do.

    Anyway, good luck whichever way the cards fall.

  • Geekomatic on 18/04/2014 - 16:21
    +1

    Double-check your superfund.

    After my place of business closed in 2011 (& 5 days later I was badly injured in a MVA)— it wasn't until a letter I received on Dec. 2013, about me "not having to worry because I was still covered" with IPS that I realized I was covered all that time! I'm now in the process of claiming it back retro-actively.

    Have a thorough read of your superfund to see if they include income protection insurance by default.

    Good luck!

    • Geewhizz on 20/04/2014 - 07:25

      +++++

      I think these days income protection insurance is included and you'd specifically have to opt out of them to not be covered. The length of time you wait before benefits apply can be altered by the individual.

      OP hubby recently reduced this waiting time on his, and doesn't recall the issue of possibly redundancy being one of the issues that was discussed with the company rep.

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