With government cuts expected to add thousands of people who work for the state or for organizations that rely on state handouts to exist to the numbers out of work, many payment protection insurers are increasing rates, restricting cover and choosing who they accept. Few, if any, are prepared to follow the regulatory guidelines of treating customers fairly and being honest and open about their 'black list' of organizations and companies that each refers to on accepting new business.
In July, one insurer admitted it will no longer provide new cover for civil servants or local authority workers- one in six of the working population- and was not prepared to reveal if it was just increasing renewal premiums or not offering renewal for that sector. Many hide behind the tired "it depends on individual customers" mantra.
Independent insurer British Insurance has always bucked the trend and had few qualms about criticizing rival insurers and banks. A competitor survey told it that many competitors had increased premiums for income and mortgage protection cover and it was one of the few, if not only, online provider still prepared to offer standalone unemployment policies.
British Insurance argues that applicants should only be rejected for cover if they are aware of any impending unemployment or the employer has announced job losses, departmental or company restructures or mergers with another company. It also argues that it is unfair that at a time that public sector workers who may have thought this insurance was not applicable to them are now re-assessing their financial circumstances- are being denied insurance by the majority of the market. It argues that and those unaware of any specific job losses should be able to apply for cover.