Owing to the Covid-19 pandemic and economic crisis, job stability has become a concept of the past. Most of the salaried class are constantly living under the fear of job loss and pay cuts. Amidst such unprecedented uncertainty, job loss insurance is one of the best ways of protecting yourself and your family. According to the latest data published by the Centre for Monitoring of Indian Economy (CMIE), the country’s unemployment rate rose to 7.24% for the week ending August 8.
Eligibility criteria
Job insurance policies have certain eligibility criteria. One of the basic criterion is that an interested person should be an employee of a registered company.
Cover
A job insurance policy offers financial security to the policyholder and the family in case he or she loses a job. After job loss, the policyholder will be eligible to get compensation for a certain duration.
In India, job loss insurance is not provided as a stand-alone insurance policy. It can be availed as a rider benefit. Generally, job loss insurance comes with a health insurance or home insurance policy.
Premium
Typically, the premium towards job insurance is the range of 3% to 5% of the total coverage, on top of the master policy’s premium.
Exclusions
Despite being a reassurance, job insurance provides very limited cover. Most companies offer 50% of the net income. The following are the some of the most common cases when job insurance does not provide any coverage:
— Self-employed or unemployed individual
— Unemployment during probation period
— Early retirement or voluntary resignation
— Job loss due to existing illness
— Suspension, retrenchment, termination for underperformance or fraud
Renewal process
As job loss insurance is available as a rider benefit, there is no separate process to renew the policy. Once you renew the main policy, it is automatically renewed.
Published: August 11, 2021, 15:52 IST
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