Although you may be able to add a redundancy option to your income protection insurance or life insurance policy, most income protection insurance plans only cover loss of income due to illness or accident (depending on the insurance policy). Only a few insurers sell income protection redundancy insurance separately. If you have redundancy insurance and your employer lays you off, you will receive payment for up to a certain time (which might range from two to six months) or until you find a new job. Your payments will be based on a percentage of your pre-redundancy income (based on evidence of income provided when you purchased the policy) or an agreed amount.