You probably have read about unemployment insurance in some of the articles about property or money insurance in this blog, but I haven’t really made a specific discussion about this matter until now.
Prepare for the worst, that would be a proper answer for the question why you should have this type of insurance. Today, there’s absolutely no guarantee that you can have a long lasting job. Risks such as cutbacks and redundancies are becoming unavoidable, the increasing trend towards outsourcing of labour and more short-term flexible working contracts have increase the posibility of losing your job anytime. The economic instability in a country could also make an impact on job security. And eventhough the employer might give you severance, there’s still no guarantee that the amount should be enough to support your daily expenses until you find another job. To avoid these problems that may rise someday and in order to get you a peace of mind, you might consider to have unemployment insurance.
The protection given by unemployment insurance is by making monthly payment to you if suddenly you become unemployed or losing your job for the cause that is outside of your control.
In many insurance carriers, unemployment insurance is usually combined by accident and sickness insurance. Those are the risks that could caused you to not be able to work and losing income. Some insurance companies use to split the covers in two elements, accident and sickness which is also covers any dissabilities that keep you out of work in a certain time period, and unemployment insurance that covers the period of time you spend without a job.
Make sure that you are extremely selective in choosing the proper insurance policy and read the terms and conditions in your policy carefully so you won’t have to pay for any coverage you don’t need because some companies packaged many type of covers into one comprehensive policy that might not suits your needs such as specific cover for mortgage payments, other loan payments, or a regular income. Choosing lesser cover which is just the kind of cover you might need could give you a lower unemployment insurance premium rate, so choose it wisely.
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