I have applied to naturalise as a British citizen, using a Permanent Residence document. I am still waiting for a decision on my citizenship application. Should I apply for settled status just in case?

After 1 July 2021, if you do not have pre-settled or settled status (or another immigration status), and you are not a British citizen, then you will lose your legal rights of residence in the UK. 

It may be a good idea to get legal advice. 

However, while you are not yet a British citizen, you are able to apply for settled status.