Layoff Insurance Information
Layoff insurance--also known as job-loss insurance--provides financial protection to workers who lose their jobs. Coverage can be purchased as an extended benefit of your homeowner's insurance to guarantee your mortgage is paid if you're laid off.
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Cost of Layoff Insurance
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The cost of layoff insurance is determined by the amount of benefits you select, but generally ranges from $50 to $70 per month, as of 2009. Higher monthly premiums mean more generous benefit payouts. See Resources for a link to compare policies in your area.
Monthly Payment
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Depending on the policy you choose, you can expect to receive anywhere from $740 to $1,500 per month in payouts.
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Eligibility
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Although eligibility criteria can vary among insurance companies, in general, you must be: a W-2 employee; eligible for unemployment compensation; and have been paid at least four months of consecutive premiums prior to purchasing coverage. Insurance companies may also institute a 30-day waiting period before payouts can start.
Benefit Terms
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You are entitled to receive up to four months of payouts after you become unemployed, and less if you find a job within the four-month window before having to reapply for benefits.
Purpose
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Layoff insurance benefits are meant to supplement government unemployment insurance (UI) benefits. Depending on your employment history and the state where you live, your UI benefit amount can range from $400 to $800 per week. As of 2009, the average weekly payout was closer to $300, which isn't always enough to cover your bills. For this reason, you may choose to purchase layoff insurance for the added peace of mind that your mortgage can be paid if you lose your job.
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References
Resources
- Photo Credit rope lock. the climbing insurance. image by Ivan Hafizov from Fotolia.com
