Public sector still eligible for MPPI

Despite recent Government announcements that cuts of up to 40 per cent will be made to staffing levels in the public sector, staff whose jobs are at risk are still eligible to take out mortgage payment protection insurance, says provider British Insurance.

Generally, anyone who knows their job is at risk before they take out a policy will not be covered. But, says Nel Mooy, managing director of British Insurance, because there have been no specific announcements about which jobs will be cut, MPPI remains an option.

"People whose employers announce a specific programme of job cuts, department or company restructures or mergers with other organisations will not be eligible to take out cover," said Mooy. "However, as long as public sector workers have not been advised of specific cuts within their departments, there’s no reason why they cannot apply to purchase PPI.”

While no announcements have yet been made, the Chartered Institute of Personnel and Development has warned that 750,000 people currently employed in the public sector could lose their jobs by 2012.

“Speculative opinions should not be taken into account when assessing whether to insure an individual or not," said Mooy. "The decision should be based on their current employment situation and whether that person has been in full-time employment for six months, prior to the policy start date.

“We don’t even know how these cuts will be made yet, the majority could be through natural wastage rather than huge redundancy programmes and until the actual percentages are confirmed, I suggest we follow the morale-boosting slogan used in the late 1930’s - ‘keep calm and carry on. It’s certainly the stance British Insurance is adopting and is particularly pertinent to our policies. PPI should not just be a crisis purchase as it offers financial protection and peace of mind during the whole of the employment journey.”