Just a month ago, the UK watched as Covid19 took hold in other countries across the world. In an astonishingly short space of time, the illness - caused by the coronavirus - has not only arrived on our shores but has created the biggest peace-time crisis in living memory, escalating not just day by day, but hour by hour.
At ActiveQuote, we saw an instant spike in enquiries about income protection and now, sadly, many redundancies seem likely as businesses throughout the UK face closure. As thousands of workers self-isolate at home and with schools set to close imminently, the consequences for millions of households are stark.
So how might coronavirus affect your income and what are the financial steps you can take? Here’s our guide*.
Coronavirus and income protection
The good news for our existing customers is that if you had already taken out income protection before the virus spread, you’re covered under the terms of your policy.
Income protection covers you against sickness, an accident or involuntary redundancy that leaves you unable to work, providing a monthly payment of up to 70% of your salary. If your work is looking uncertain in the face of coronavirus - or if you have already been made redundant - now’s the time to check your policy and get in touch with your insurance provider.
Our head of partnerships and marketing Rod Jones said: “As of Tuesday, March 17, virtually all the unemployment income protection providers have pulled out of the market, so we are no longer able to offer this product to new customers.
“This week, we have handled 10 times as many calls as usual regarding income protection. We are still offering accident and sickness income protection, but not unemployment cover. This means that new customers can’t get this cover; however, existing customers are fine and their policies unaffected.”
Coronavirus and sick pay
If you have to take time off work because you have the illness, or are self-isolating in case you have it, claiming sick pay could be an option for you. You might be enrolled in a company sick pay scheme, in which case speak with your manager or HR team to find out what’s covered and when you can claim.
You might also be eligible for statutory sick pay (SSP). Currently, SSP is available to employees earning at least the equivalent of 14 hours on the minimum wage, or £118 a week. SSP stands at £94.25 per week and is paid by your employer for up to 28 weeks if you’re too ill to work.
Usually, workers can claim SSP only after being off work for four days. Following coronavirus, however, the Government announced that anyone eligible for SSP and affected by the illness can claim from day one. This applies to workers who have the virus and those who are self-isolating because someone in their household has symptoms.
If you can’t get to work, you need to tell your employer as soon as possible and explain that your absence is due to coronavirus. While you would usually require a sick note from your GP to claim SSP, the Government has asked employers to be ‘flexible’ about evidence in the case of the virus.
Coronavirus and the self employed
Anyone not eligible for statutory sick pay, such as the UK’s five million self-employed workers, can apply for Employment and Support Allowance (ESA). You can apply for ESA if you’re employed, self-employed or unemployed and the seven-day wait period for new claimants will not apply if you are suffering from coronavirus or are required to stay at home; it will be payable from day one.
If you are an employer or run a business, follow government advice on what to do if an employee becomes ill, as well as on loans and grants available to help you stay afloat at this difficult time.
Coronavirus and claiming benefits
If you have to stay at home due to coronavirus, you can apply for Universal Credit. Self-employed claimants will not have the Minimum Income Floor - an assumed level of income - applied for the period of time for which they are affected, and you can also receive up to a month’s advance without physically attending a jobcentre.
* Please be aware that the situation is changing daily and we will do everything we can to update our customers as new developments unfold.
Information correct as of 3pm 18th March 2020