Earlier this year I reported how a young mother received an unwanted – and unexpected – text message from the Work & Pensions Department on Christmas Day.
She was dispatched at around 8am and said her entitlement to Personal Independence Allowance (PIP) was being reviewed. The benefit is paid to people with long-term physical or medical conditions that make performing daily tasks difficult.
Although PIP is not means tested, payments are subject to assessment. These assessments are often traumatic experiences, sometimes requiring a medical examination. They can also lead to payments being stopped.
The recipient, who struggles with mental health issues that can only be controlled by powerful epileptic medication, had a meltdown as soon as she read the text. She suffered a panic attack and anxiety problems which ruined the festive day for her and her family.
I asked the DWP at the time whether they thought it appropriate to send such an insensitive text to so many people on an important family day of the year. I also asked how many text messages it had sent on Christmas Day notifying PIP claimants of upcoming assessments.
Festive atmosphere: According to the DWP, it sent 1,454 PIP award review texts on Christmas Day
The press office responded by saying that the information I requested was not available except through a Freedom of Information (FOI) request. Insensitively, no comment was made on the poor timing of the text. Well, I submitted the FOI request and a few days ago I finally got my answers. According to the DWP, it sent 1,454 PIP assessment texts on Christmas Day.
Of these, 68 related to an award that was coming to an end and gave rise to an automatic assessment. The remaining 1,386 were due to a reported change in an individual’s circumstances, requiring another payment review. The reader’s text fell into the first camp. While the FOI response did not defend the tasteless Christmas texts, it did say they were for ‘information only’ and did not require any immediate action from recipients.
It also said that all messages were automated and sent during the work week (Monday to Friday). It added: ‘There is currently no mechanism built into the PIP system to exclude messages from being sent on a specific date.’ In light of the Christmas Day anxiety that the text has caused our reader – and (no doubt) many other recipients – I think it is time for the DWP to reconfigure its ‘PIP system’. No PIP review texts should ever be published on December 25, regardless of what day Christmas falls.
As for our reader’s PIP review, it goes on and on. All relevant documents have been sent to the DWP. The decision is awaited.
Be aware of the value of protection insurance
Protection insurance, which provides financial comfort in the event of a serious illness, is both undersold and underbought.
Whether it’s critical illness cover (which pays out an agreed tax-free lump sum if a claim is successful), income protection (which pays out a regular stream of tax-free income) or even standard life insurance, sales are pitifully low.
Why? Well, too few financial advisors can be bothered to sell such coverage, preferring to manage wealthy people’s investments and charge them high fees for the privilege of doing so.
Meanwhile, providers, a timid bunch, are far too reluctant to promote the coverage – leaving much of the public (young and old) with no idea that financial protection insurance even exists. The result of all this is that far too many households are ill-equipped to deal with the financial impact of a breadwinner or homemaker suffering from a serious illness.
In short, there is a gap between what households enjoy in terms of financial protection – and what they should have. This rather disturbing picture is confirmed by an informative consumer survey just published by CIExpert, a company specialized in comparing the individual benefits of critical illness policies offered by insurers.
CIExpert asked the audience – across the age spectrum, from Generation Z to Baby Boomers – a series of questions about financial protection insurance. The findings were disturbing.
According to CIExpert, around two-thirds of consumers have never purchased a critical illness policy or income protection plan. About five and seven percent respectively have no idea whether they have or have ever had such coverage. There are many misunderstandings about how coverage works. For example, almost one in five consumers wrongly believe that the proceeds from a successful critical illness claim should be used to pay off a mortgage – while 19 percent believe that every payout will be taxed (which is not the case) .
Two-thirds of people are unaware that premiums are fixed for the term of the policy, which can be 30 or 35 years. Others are unaware of the other benefits offers cover – for example free annual health checks and access to a second medical opinion. Protection insurance should be an important part of our financial arsenal – we simply don’t know what’s lurking around the corner.
That is exaggerated! Land Rover drivers now receive an additional deductible
Jaguar Land Rover has been quite testy with insurance companies over the way they are raising premiums for drivers of its luxury cars – and in some cases even refusing to cover them.
The company’s anger is understandable given the potential threat to sales. It also explains why the company launched its own insurance coverage to keep drivers entertained.
Nigel Barker, director of workplace purchasing company Dennons UK, is experiencing the tough approach that many insurers are taking towards owners of some JLR cars.
Anger: Jaguar Land Rover is quite testy with insurance companies over the way they are raising premiums for drivers of its luxury cars
He is driving his fourth Land Rover – a three-year-old Discovery Sport – in 12 years and has recently commissioned brokers to provide competitive renewal quotes for this and a Mini Electric. Nigel – and his wife Christy – both use cars in their family business.
In terms of price, Aviva came out on top, but there was a condition in the cover that Nigel had never seen before: an additional theft excess (on top of the £250 excess), which applied specifically to each Land model Rover or Range Rover. with a market value of € 25,000 or more.
It states: ‘In the event of loss or damage to your vehicle (including its accessories and spare parts) caused by theft, an additional excess will apply to your claim, calculated as five percent of the market value of your vehicle. vehicle at the time of loss.” For Nigel, this would result in an additional deductible of €1,750.
This additional deductible is included even though Nigel’s car has undergone a security upgrade, which reduces its vulnerability to theft.
“I love Land Rover,” says Nigel, who lives in Todmorden, West Yorkshire. “But this insurance tirade against the brand is testing my love affair to the limit.”
The greatest irony of all is that JLR’s insurance company was unable to provide Nigel with a quote for his Land Rover.
Stamp duty ripe for reform
Stamp duty on home purchases is a tax ripe for reform – and in last Wednesday’s Money Mail we called on the Chancellor to put an ax to it in next month’s Budget.
The tax is an obstacle to a well-functioning housing market. It stops people from moving up in the housing market as they get further into their working lives – and it stops homeowners from downsizing later in life. A vibrant housing market, on the other hand, is good for everyone – and an economic stimulus. Stamp duty reform could help achieve this.
If you agree – or if the prospect of a large stamp duty bill deters you or your children from moving, please email me at jeff.prestridge@mailonsunday.co.uk. I am all eyes and ears.
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