Covered against the redundancy aftershock of the credit quake?

moneysupermarket.com advises consumers to consider protecting themselves against the worsening effects of the credit crunch.

Job losses are becoming more commonplace in the current climate and many Brits may be looking for options to insure their salary should they be made redundant, or be unable to work through illness or accident. People can cover themselves with payment protection insurance (PPI); insurance that will pay out a monthly sum to help if they become unemployed.

However, despite the potential to offer people a lifeline in times of need, research from the price comparison site reveals only one in seven Brits (14 per cent) consider PPI crucial and already have it. In contrast, almost a quarter of people (24 per cent) do not even know what it is. However, seven per cent admit the economic uncertainties have made them consider buying it.

Emma Walker, head of protection at price comparison website moneysupermarket.com, said: "Whether it's mortgage or loan repayments or credit card commitments, Brits looking to insure their income should consider a PPI policy. It's worrying that a quarter of us don't know what it is and, therefore, the benefits of a policy. More concerning is a tenth of people would only buy a PPI policy if they felt their job was under threat.

"The best time to buy a policy is when you least expect to need it - the small print will usually reveal insurance of this kind is void if the policyholder is aware of impending unemployment. Even if the sector you are employed in has seen mass redundancies, you could be tarnished 'high-risk'. Be upfront with your adviser about your situation and get as much information on your policy as possible so you're not in for any shocks. Exclusions and caveats are commonplace in a policy."

UK employers are negative about the employment outlook for the fourth quarter of 2008 - expecting an eight per cent decrease in hiring. Further research from the leading price comparison site found applications for PPI policies was dominated by those employed in the finance and business sector (39 per cent), followed by those in the construction industry (16 per cent) - areas which have suffered from recent job losses and could have benefited from having a PPI plan in place.

For Brits looking for PPI, moneysupermarket.com found monthly premiums for a 35 year old man or woman looking for accident, sickness and unemployment (ASU) cover for a £600 monthly income from under £15.

Emma Walker continued: "Policies such as PPI can be complicated so customers should seek advice if necessary and ensure they've read the small print of the policy - the last thing you want is not be covered at a time when you need it most. It's important to consider what is appropriate for your circumstances and what levels of cover you need. Insuring against unforeseen circumstances in the current economic climate is wise and standalone policies can be well worth the initial outlay."