As the name suggests, Accident Sickness and Unemployment Insurance (ASU) pays out if you’re unable to work due to accident, sickness or unemployment. If you claim, it pays you a monthly agreed sum. It is the same as Short Term Income Protection (STIP) insurance which is the more commonly used description for this type of cover.
If you’re over 50, it is quite possible that you have an ASU policy or have held one in the past. You will frequently hear ‘ASU’ mentioned by Mortgage and Insurance brokers who are still familiar with this old fashioned description. However, the cover is the same as STIP. The name change resulted from the insurance industry trying to use the title of the product to differentiate Accident, Sickness and Unemployment insurance (ASU) from Accident and Sickness insurance. Accident and Sickness insurance is not linked to your income, the monthly benefits are quite low and cover includes specific sums paid for certain injuries such as the loss of an eye or hand.
Confusingly similar names do not help the consumer. STIP therefore makes this distinction more obvious rather than continuing with the Accident Sickness and Unemployment title. It also helps to identify that Short Term Income Protection is designed for longer periods of absence when your earnings may be affected. Consequently the benefits are higher and usually paid out for much longer periods (1 to 5 years) than Accident and Sickness insurance.
Please see our Guide to Short Term Income Protection insurance if you want to know more about the modern version of Accident, Sickness and Unemployment insurance.
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