3. In both Schedule 3 to the Disability Working Allowance (General) Regulations 1991(1) and Schedule 2 to the Family Credit (General) Regulations 1987(2) (sums to be disregarded in the calculation of income other than earnings), after paragraph 25, there shall be inserted the following paragraph—
“25A.—(1) Subject to sub-paragraph (2), any payment received under an insurance policy taken out to insure against the risk of being unable to maintain repayments—
(a)on a loan which is secured on the dwelling which the claimant occupies as his home; or
(b)under a regulated agreement as defined for the purposes of the Consumer Credit Act 1974 or under a hire-purchase agreement or a conditional sale agreement as defined for the purposes of Part III of the Hire-Purchase Act 1964.
(2) A payment referred to in sub-paragraph (1) shall only be disregarded to the extent that the payment received under that policy does not exceed the amounts, calculated on a weekly basis, which are used to—
(a)maintain the repayments referred to in sub-paragraph (1)(a) or, as the case may be, (b); and
(b)meet any amount due by way of premiums on—
(i)that policy; or
(ii)in a case to which sub-paragraph (1)(a) applies, an insurance policy taken out to insure against loss or damage to any building or part of a building which is occupied by the claimant as his home and which is required as a condition of the loan referred to in sub-paragraph (1)(a).”.