Is there an insurance that covers you for a while if you get fired

[Wesley_Clark]

I know there are severance packages and unemployment, but is there a form of insurance that pays you a percentage of your gross income for a set amount of time if you get fired?

[Cunctator]

Insurance is available in Australia that covers a proportion of your mortgage repayments for a limited period if you beome unemployed. The payments are made straight from the insurer to the lender. I’m not aware of any type of insurance that pays an income benefit directly to you if you become unemployed. “Income replacement” policies generally provide benefits only if you can’t work through illness or disability.

[Absolute]

I’ve had that idea myself as a possible business venture, but after some consideration it doesn’t seem that viable.

Premiums would be highest for people with low job security, and those jobs are typically the most low-paying. Unemployment insurance would be too expensive for most of those who need it.

Of course, I could be wrong, but I’ve never heard of unemployment insurance that would be purchased directly by consumers (which I assume is what you’re talking about). There does exist unemployment insurance which is purchased by companies on behalf of employees, but I don’t think it’s the same thing.

[Quartz]

@Wesley Clark

I know there are severance packages and unemployment, but is there a form of insurance that pays you a percentage of your gross income for a set amount of time if you get fired?

Yes. Strangely enough, it’s called Unemployment Insurance.

Top entry on Google is http://www.unemployment-insurance.co.uk

Of course, this is for the UK - I don’t know about the US

[Khadaji]

I *think * COBRA insurance should be available to you even if you are fired. You have to pay for it, but it should be available. Do a Google for COBRA and INSURANCE and you will find lots of hits.

[ltfire]

Is there an insurance that covers you for a while if you get fired
Yeah, my son has it…up to a certain point.

It’s called MomandDad.

[LSLGuy]

@Khadaji

I *think * COBRA insurance should be available to you even if you are fired. You have to pay for it, but it should be available. Do a Google for COBRA and INSURANCE and you will find lots of hits.

COBRA give you the right to buy HEALTH insurance from your former employer’s carrier for, IIRC, 18 months for scarily high premiums. The OP was asking about insurance to pay a substitute PAYCHECK.

Wesley, AFAIK, there’s nothing like that available in the US.

There are policies available in the US , like Cunctator mentioned for Australia, which will replace some part of your wages for awhile if you’re disabled. These are popular with people who have jobs with high physical standards. I have one, since my job requires me to have near-perfect health & I’m unable to work at my job if injured even a little bit. Conversely, the Federal definition of “disability” for SSI is simply “are you too unhealthy/handicapped to work at any job?” The insurance (not cheap) covers the difference between “healthy/intact enough to work as a call center operator / gas station money-taker” and “healthy/intact enough to work as a pilot.”

There have been discussions by US policy wonks about introducing some sort of income insurance that you cuold buy to protect yourself against layoffs or such. The idea is to make the whole job uncertainty / globalization thing more survivable (& hence palatable) to the averge working stiff.

But I’d be amazed if they’d ever extend such cover to people quitting on their own or being fired for being a screwup. It’d be waay too easy for folks to cheat.

[Waenara]

Canada has Employment Insurance. I guess I’ve always taken it for granted (although I’ve never used it), because until I saw this thread I never realized that the US doesn’t have it.

Everyone working in Canada has Employment Insurance (EI) premiums deducted off their paycheck. This is how they calculate your premium rate:

You will pay premiums on all your earnings up to the annual maximum salary of $39,000. This means that deductions for the year 2004 is $1.98 for every $100 of salary until $39,000 has been reached. The maximum contribution amount is $772.20 for 2004.

For the year 2005, EI premiums will be $1.95 for every $100 of salary until $39,000 has been reached. The maximum contribution amount will be $760.50.

EI is available if:

• You can receive regular benefits if you lost your job through no fault of your own (for example, due to shortage of work, seasonal or mass lay-offs). To find out about the requirements for regular benefits…
• You can also receive maternity, parental and/or sickness benefits if pregnant, caring for a newborn or adopted child or sick. To find out about the requirements for maternity, parental and sickness benefits…
• You can receive fishing benefits if you are a person engaged in fishing.To find out about the requirements for fishing benefits…
• You can receive compassionate care benefits if you have to be away from work temporarily to provide care or support to a family member who is gravely ill with a significant risk of death. To find out about the requirements for compassionate care benefits…

After you stop working there is a two week waiting period before you can collect benefits. Benefits are caculated as a percentage of your income:

The basic benefit rate is 55% of your average insured earnings up to a maximum amount of $413 per week. Your EI payment is a taxable income, meaning federal and provincial or territorial (if it applies) taxes will be deducted.

[Waenara]

Sorry… hit “Submit” instead of “Preview”.

Also, to qualify for Regular EI benefits:

Regular benefits can be paid if you lose your job through no fault of your own (for example, due to shortage of work, seasonal or mass lay-offs) and you are available for and able to work but you can’t find a job.

To be eligible for regular benefits you must show that:

* you have been without work and without pay for at least 7 consecutive days; and
* in the last 52 weeks or since your last claim (this period is called the qualifying period), you have worked for the required number of insurable hours. The hours are based on where you live and the unemployment rate in your economic region at the time of filing your claim for benefits.

There is a maximum period for which you can receive benefits:

How long can regular benefits be paid?

Regular benefits can be paid from 14 to a maximum of 45 weeks. The number of weeks of benefits which may be paid are determined at the start date of the benefit period, based on the unemployment rate in your region and the amount of insurable hours you have accumulated in the qualifying period.

[fishbicycle]

There’s nothing like it in the US. But I have past experience with the Canadian system. If you have worked the minimum number of weeks to be eligible, and quit or get fired, there was a six-week waiting period. For a person with a low-paying job, living from payday to payday with no means to save anything, this is just enough time to get evicted for non-payment of rent. During this waiting period, you can’t get welfare to tide you over until you start getting unemployment. You lose your room or apartment and have to live on the street or at the Salvation Army hostel. Then you can’t even get welfare because you don’t have a permanent residence. And the wheel goes round and round. Been there, done that, had to eat the T-shirt.

[Wesley_Clark]

@fishbicycle

There’s nothing like it in the US. But I have past experience with the Canadian system. If you have worked the minimum number of weeks to be eligible, and quit or get fired, there was a six-week waiting period. For a person with a low-paying job, living from payday to payday with no means to save anything, this is just enough time to get evicted for non-payment of rent. During this waiting period, you can’t get welfare to tide you over until you start getting unemployment. You lose your room or apartment and have to live on the street or at the Salvation Army hostel. Then you can’t even get welfare because you don’t have a permanent residence. And the wheel goes round and round. Been there, done that, had to eat the T-shirt.

Is that private insurance or something like unemployment compensation like we have in the US?

I’m referring to something like a system where you pay $100 a month then if you get fired or your job is shipped overseas you recieve $400/month for 18 months until you can find a new job.

I guess its a bad idea since it’d be alot easier to just invest $100 a month into a personal fund instead of investing it in an insurance plan. Plus the jobs that need hte insurance the most would have the highest premiums, making the insurance unavailable to people who need it most (like health insurance in the US).

[Ludovic]

A…

A…

A…

can’t even bring myself to do it!

[fishbicycle]

@Wesley Clark

Is that private insurance or something like unemployment compensation like we have in the US?

It was the system as described by Waenara, where an amount is automatically deducted from your pay every week, so that if you need to use Unemployment Insurance (which they now call Employment Insurance), you have paid into the system and can then get benefits if you need them. But you have to lose your job by some other way than quitting or getting fired, or it gets real ugly, real fast.

[Gfactor]

1. There is no insurance policy that replaces wages when you have been fired. Such a policy would create what insurers abhor–a moral hazard . If you could get insurance for getting fired, you’d have less incentive to stay at work because the consequences would be less severe.

2. COBRA is not a form of insurance, it is an option that is available to those who have lost their jobs. They get to continue their group health coverage for a period of time after they have lost a job. Of course, they have to pay the entire premium themselves, which is impossible for most jobless people. But it is one form of job loss protection.

3. There is also insurance available for repaying some debts if the insured loses a job. http://www.bankrate.com/brm/news/mtg/20011108a.asp?prodtype=insur

Hope this helps.