Effects on State Benefit

Please note: Your monthly benefits from this policy are tax free

If you do find yourself temporarily without income the information below will help you to understand the benefit payable by the government and the effect your benefits from this policy may have on it. The important point to note is that whilst helpful, the JSA and SSP is a very small proportion of the monies you may require to maintain your lifestyle. Since October 1995 new mortgage borrowers receive no state help for the first 9 months of unemployment or disability and that help is only towards interest costs on the first £100,000 but not any debts consolidated into the mortgage. Existing borrowers receive nothing for the first two months.

UNEMPLOYMENT

This assumes you are out of work and registered as unemployed with your local Job Centre Plus office or the Department of Health and Social Security in Northern Ireland.

Contribution based Jobseekers Allowance (JSA) It is not means tested and therefore your benefits from this policy would not affect the payments.

Payable to unemployed claimants who have paid enough National Insurance contribution and who are available and actively seeking work. It is payable only for the first 6 months of unemployment after which period the claimant is assessed under the JSA (income based) rules.

You must speak to your JobCentrePlus to confirm the benefit rates for yourself as they are subject to change but they are approximately:

Aged 18-24 = £45.50 per week
Aged 25 and over = £57.45 per week

Income based Jobseekers Allowance (JSA) This is means tested and therefore your benefit may be affected.

Payable to unemployed claimants who are available and actively seeking work but who do not qualify for Contribution based JSA (ie they have not paid NI for the last two years).

ACCIDENT & SICKNESS

This assumes you are unable to work due to accident or sickness and are in receipt of Statutory Sick Pay from your employer or Short Term Incapacity Benefit from the Job Centre Plus

Statutory Sick Pay
SSP is paid to employees who are unable to work because of sickness. SSP is paid by your employer for up to a maximum of 28 weeks after which, if still incapacitated you would apply for Short Term Incapacity Benefit.

From April 2006 the standard rate is £70.05 per week

Short Term Incapacity Benefit
This is not means tested this is paid if SSP has ended or you cannot get SSP if, for example, you are self employed. You must have been paid or credited with a minimum amout of National Insurance Contributions in one of the last two tax years.

You must speak to your JobCentrePlus to confirm the benefit rates for yourself as they are subject to change but they are approximately between £60-£70.00 per week.