Unemployment Protection Insurance

Unemployment is one of those situations that you should never take for granted. It's easy to think that you will immediately find another job, however the job market is increasingly volatile, and there could be months between your initial application to your first pay check.

The old adage of "a Job for Life" has all but disappeared, globalisation has seen to that. The workplace is transient, technology moves fast, and businesses can change direction very quickly. This ultimately means that unfortunately, sustained job security has gone.

It's not all bad news because it means that there are lots of jobs out there, new industries, new business's and lots of choice, if you live in the right area, that is. Finding the correct job for your skills, location, salary expectation and lifestyle is the hard part, and this can take time. This is where unemployment protection can prove invaluable.

If you have been unfortunate enough to have lost your job or been made unemployed, then you know that time is against you financially. Give yourself some breathing space and purchase some unemployment protection insurance. It will give you that much needed financial space to find that new position that compliments your skills, suits your location and salary expectations, and slots in nicely with your current lifestyle. It is the most sensible and practical option for you in this fast moving and turbulent job market.

What is unemployment insurance?

Unemployment insurance is a form of income protection that pays you a monthly tax-free payment, for a maximum of 12 months, should you lose your job involuntarily. It is your own personal financial life jacket, should circumstances beyond your control result with you losing your job.

Unemployment insurance is available to anyone who is working more than 16 hours per week, and living and working in the UK. It is linked to how much you earn, and the policy will cover a percentage of your weekly or monthly wages or salary. The idea is for the policy to replace the majority of your income, not all of it. You should not be financially better off should you find yourself unemployed. You should, however, land upon a monthly benefit amount that will allow you to continue to pay your monthly financial commitments and general outgoings.

The policy will provide a payment to you directly, so that you have enough money to maintain your lifestyle whilst you are looking for a new job role. It provides the necessary financial relief and support, so that you can concentrate on the all-important task of finding your next career path and new salary, a career path and salary that is line with your skill set and not a stop gap because you are desperate to find a job as you need the money.

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Why unemployment insurance?

Unemployment insurance will guarantee you financial security when your salary is involuntarily taken away. According to ONS statistics, a quarter of UK households have less than £95.00 in savings to fall back on. Home-ownership among families has also fallen to its lowest level in 4 years. Overall, the average cost of living is increasing, our income is not. With Job Seeker's Allowance paying just £68 per week, could you survive without a regular income?

You can do something to make sure that you are in control of your financial future by insuring your income against the possibility that somewhere, somehow, out of the blue, you could become unemployed. Comparing and choosing the most suitable, comprehensive and competitive unemployment protection insurance policy is what every person or family should do.

Unemployment insurance provides you with a tax-free monthly payment, paid directly into your bank account. It allows you to maintain paying the mortgage or rent, and also your normal household bills, without running up debt whilst you are finding yourself a new job. It means you are taking control and not leaving your financial security to chance, that is why you should choose to Unemployment or redundancy protection insurance.

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How does unemployment insurance work?

Unemployment insurance works by paying you a monthly tax-free sum, known as your benefit amount, if you were to find yourself unemployed through no fault of your own. Once you have purchased your unemployment policy, you will need to complete an initial exclusion period.

You will need to keep paying the monthly cost or premiums of the policy, and if at any time you are made unemployment or redundant, you will be eligible to make a claim on the policy. There is criteria you will need to meet to show the claims team you have a valid claim, however do not worry, it is all fairly logical.

You will need to be able to provide evidence that you are who you say you are, with ID or proof of residency for example, and you need to provide evidence of your income such as payslips or P60's. You may be required to provide evidence of any commitments you may have, like a mortgage or rent payments for instance. You will need to register with the Job Centre and obtain a Job Seeker's Agreement, and you will also need to inform the claims team on what you are doing to find a job, such as job interviews, for example. Finally, your previous employer will need to confirm that you have been made redundant and confirm the dates and reasons for your redundancy.

As you can see it is all standard information that you would expect for your claim to be paid.

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Unemployment protection insurance for the unexpected

Unemployment insurance covers you for any unfortunate and unforeseen unemployment, redundancy or job loss. It covers situations that are outside your control, such as the company you are working for suddenly loses a contract or is having a downturn, or it could be that your company is affected by global economic issues. It could be a merger, or the company could close due to bankruptcy or liquidation. Ultimately, any of the above reasons could mean your job is at risk.

Within the policy you can cover your income, or you can cover your mortgage payments or rent. Any financial agreements such as loans, credit card bills or debt management plans can also be covered, or it could be your regular household bills, like food, utilities, council tax, insurance policies, mobile phone or gadget contracts. Any direct debit commitment you have can all be covered by your unemployment protection insurance. If you have been made involuntarily unemployed, then your income which covers all of your bills is insured, and a good unemployment insurance policy provides the cover you need to maintain all of your financial outgoings.

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Do I need unemployment insurance?

Are you working? If the answer to this question is yes, then in our opinion you should at least explore the benefits of you covering yourself against unemployment. What could be the reason that you do not need a monthly tax-free payment paid to you for a maximum of 12 months, should you lose your job?

Plenty of savings, a partner, husband or wife that works, credit cards, no mortgage or bills, these are all reasons customers have provided us with when they are considering purchasing unemployment protection insurance. However, the most common reason given to us is "I will not lose my job, my employer needs me too much" or "I have just been given a pay raise, they will not make me redundant now" or "I can find a job tomorrow with my skill set".

Whilst these reasons maybe at that particular point true, the world moves fast, businesses change, markets change, and unfortunately, nothing stands still, and that includes our jobs. Being confident is great, but also be prudent. It's easy to feel secure whilst things are going well, you feel needed and you feel irreplaceable, but the reality of the situation is that nobody is ever truly prepared for an unexpected redundancy, and it can affect you in ways that are impossible to plan for. Having an unemployment insurance policy in place secures your salary and prepares you financially for whatever lies ahead.

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Types of unemployment insurance

There are many different unemployment protection policies available within the market, and deciding which one is the most suitable for you is extremely important. The main difference can be found in the initial exclusion periods, the waiting days, and the amount of cover you are able to take based on your income.

Some policies require you to have a mortgage or pay rent or have a plethora of commitments, others will only require that you are working. Some are expensive, some are cheap and some sit in the middle. Some have extra added benefits like added legal protection which could for instance help you fund an employment tribunal, others will have back to work support that could help you with CV writing or interview techniques.

Others will allow to waive the monthly premium payments should you get into claim, others will help you should you be placed on reduced working hours. All these added extras can help you choose and decide which policy is more suitable for your own personal circumstances, every job is different, every employer is different, finding an unemployment protection policy that works for your own circumstances and individual needs should be paramount.

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Am I eligible for unemployment insurance?

When purchasing unemployment insurance, there is a certain criteria that you will need to meet in order to be eligible to buy, and more importantly, eligible to make a claim.

Are you aged over 18 and under 64? Are you permanently employed in either a contract with no end date or a fixed end date working more than 16 hours per week? Are you self-employed or a Company Director working more than 16 hours a week? Are you a permanent lawful resident of the UK, Channel Islands or Isle of Man? If the answer if yes, you will more than likely be eligible to purchase an unemployment insurance policy.

Are you aware of any impending unemployment? are you aware of any restructure, re-organisation or contractual threats within the department you work in? Are you subject to any disciplinary action by your employer? If you are self-employed, are you aware of any reason as to why your company may close? Do you have any criminal convictions for fraud, theft or financial crime?

If the answer to any of the above is yes, then it may be difficult for you to purchase an unemployment or redundancy protection policy, however it is always best to check your eligibility with a trained specialist protection consultant if you are unsure, our team will be more than happy to answer your questions and guide you through the eligibility process. They will be able to tell you very quickly what your options are and what types of unemployment protection policies are available to you.

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When can I claim on unemployment insurance?

You can claim on your unemployment policy after you have completed your initial exclusion period, and you have been made redundant or unemployed. You will only be eligible if that unemployment or redundancy is involuntary.

Unfortunately, you cannot claim if you leave you job of your own free will, although it would be nice, wouldn't it? The reality is that you cannot, and no insurer will cover you against this. You can only claim if your unemployment is involuntary, so any acts of misconduct or disciplinary, or accepting a voluntary redundancy package your employer offers, is also not allowed. You must also make sure that you are out of work for 30 days otherwise you will not be eligible for any payment.

Being paid in Lieu of notice can also affect when you would receive any payment on your policy. Do not delay, as soon as you are made aware of any situation that could lead to you becoming unemployed you should contact us or the claims team, you have purchased an unemployment policy and therefore it is important that any situation that occurs we are kept informed. Even if you change your employer or your salary increases or decreases, or your working hours change, or you move to contract work you should get in touch immediately as all the above could ultimately affect your ability to claim.

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How much does unemployment insurance cost?

You can claim on your unemployment policy after you have completed your initial exclusion period, and you have been made redundant or unemployed. You will only be eligible if that unemployment or redundancy is involuntary.

If you have ever been made redundant and have suffered financially because you didn't have any protection in place, then your idea of how much it costs and is it expensive or not will be very different from someone that has never been in that situation before.

Understanding the value of having cover in place is really what you should be asking yourself, if for example someone said to you I will pay you a £1000.00 per month for 12 months tax free for the same price as you would pay for a cup of Starbucks coffee each day would that seem unreasonable or expensive? That's a monthly investment of £25, which is £300 per year for a return of £12,000 should you find yourself out of work is a different way of looking at it.

To find out how much it will cost for your own personal requirements, you can compare a selection of instant quotes from market leading insurers by clicking the button below.

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How do I compare unemployment insurance?

Comparing unemployment protection insurance is a simple process, and on our website, you can find a plethora of policies to compare all via your mobile or tablet. You can research the product benefits, read policy wordings, terms and conditions, and be confident going ahead and making your purchase.

Alternatively, if you find it easier, you can speak to one of our trained specialist protection consultants who have years of experience in providing the most comprehensive and competitive unemployment protection policies to our customers. Either way you should thoroughly understand the policy you are looking to purchase, you need to make sure that it meets your own personal circumstances. With such a variation of policies and pricing it is key to making sure you have all the correct information to make an informed choice.

Whilst it is never easy reading policy wordings and the language can be confusing, you should understand the policy you are buying. You can reach us via our free phone line, live chat, email, social media and good old-fashioned post, and we are more than happy answer any questions you have either online or offline. Be fully prepared, be full empowered with the correct information to make the correct decision and purchase an unemployment protection policy that is going to provide you the financial safety blanket you need should you lose your job unexpectedly.

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