Unemployment Insurance

Unemployment insurance is a cover against the loss of income due to a temporary period of unemployment, on the condition that the unemployed person is actively searching for employment. Unemployment insurance programs are generally supported by the government. Private insurance agencies also offer additional cover.

How to Apply for Unemployment Insurance

To apply for unemployment insurance, keep the following factors in mind:

1. Individuals are eligible for unemployment insurance only if the loss of job was not because of their fault. It can not be availed in case a person was fired due to misconduct or poor performance.
2. Other eligibility criteria to avail unemployment insurance can be checked from any of the regional unemployment insurance offices or private insurance companies.
3. Application for unemployment insurance can be completed and submitted either online or in person.
4. Unemployed individuals need to furnish necessary documents and information. This includes the social security number, the contact details of past employers and the precise dates of employment. The information can speed up the application procedure.
5. The unemployment insurance period of each agency varies. It may span weeks to months.
6. Follow up with unemployment insurance offices, whenever it is required. Keep them informed about employment status.

In case of applying for private unemployment insurance, read the fine print and understand the terms and conditions. Check the company�s claim recovery rate. With a private unemployment insurance policy, it is possible to have additional cover with respect to accidents and sickness.

Issues with Unemployment Insurance

Unemployment insurance has the following limitations:

1. Inadequate Cover: Unemployment insurance provides cover only for a proportion of the last drawn salary. At most times, this is inadequate to meet financial obligations.
2. Discourages job search: Individuals who receive unemployment insurance tend to stop looking for jobs as they slow their job search till the period when the benefits are about to expire.
3. Inefficiency and fraudulent claims: Inefficiency of the unemployment offices leads to approval of fraudulent claims. Also, the re-employment status of the individuals is not monitored comprehensively. This leads to misuse of the resources of the region.

Unemployment insurance enables individuals to financially support themselves in the absence of employment. However, the system requires close monitoring so as to avoid fraudulent practices and wastage of resources.

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