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There are many Loan Payment Protection policies on the market and they all vary slightly to one another. Therefore, before you buy any policy you must check out the exclusions - the circumstances that will invalidate a claim. You will normally find the information in the section on "exclusions" which you can read within the policy's Terms and Conditions.
However, as an introduction, the following are fairly typical (but not necessarily exhaustive) sample of exclusions: -
Exclusions which often invalidate a claim for unemployment:
- Your unemployment started within X days of you taking out the loan (60 days is common)
- Before you took out the policy, you had reason to believe that you may be made redundant.
- You became unemployed voluntarily
- You were dismissed as part of a disciplinary procedure
- You worked less than 16 hours per week
- Your employment was temporary or seasonal
Exclusions which often invalidate a claim for sickness cover:
- The sickness results from a disability or condition that you knew about in the 12 month period before your loan commenced
- Time off in connection with the normal symptoms of pregnancy
Exclusions which often invalidate a claim for accident cover:
- Your negligence caused the accident
Exclusions which often invalidate a claim for death cover:
- Death results from suicide within X months of the start date of your loan (typically 12 months)
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