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Life is uncertain, one can never predict the future. Even specialized world-class analysts could not predict the black swan event of the global pandemic that is now known as the COVID-19 pandemic.
Millions of people during these times faced tremendous difficulties and millions of people all around the world lost their jobs.
In fact, according to a report of the National Statistical Office (NSO), India’s GDP was adversely affected due to the pandemic resulting in a sharp decline of 23.9% in the 1st quarter of 2020.
One must be cognizant of the harsh fact that anyone can lose their job and consider looking into insurance for job loss. A job loss insurance policy can provide the cushion that you require during difficult times.
Let us discuss the following:
Job insurance provides financial safety or security to the policyholder and his family for a specified period in case the policyholder loses their job.
The insurance company will pay the insured a sum assured if the policyholder loses his/her job due to reasons that are mentioned in the policy wordings.
The policyholder may lose his job due to a certain critical illness or suffers from any kind of disability. The insurance company will compensate the policyholder for the same.
Insurance cover in India is not available as an independent policy yet. That being said, it can be taken as an additional rider on certain base policies.
Many insurance companies in India offer you job insurance cover along with a critical illness cover, personal accident cover, or even a home loan protection plan.
A job insurance cover is apt for you if you are the only earning member in your family, and want to mitigate any financial risks that you may have to face due to the loss of your job.
Job insurance cover covers the following:
This cover provides financial cover in case the policyholder has lost his/her job.
The cover will offer financial help to the policyholder in case the policyholder is suspended from his job due to specified reasons mentioned in the policy document.
The insurance company will provide financial relief to the policyholder in case they have been diagnosed with a critical illness costing them their job (illness covered under the policy bond).
The insurance company will pay the policyholder’s loan EMI up to a specified period providing the policyholder a breather while he looks for another job.
Following is the eligibility criteria for job loss insurance:
The insurance company will not provide coverage under the following conditions:
Step 1– In case of a job loss/ termination. The policyholder must immediately inform the insurance company about the same. The policyholder must write a formal letter providing the details about the incident attached along with proof of unemployment.
Step 2– The policyholder will be required to submit supporting documents to the insurance company to validate his claim.
Step 3– The insurance company will compensate the policyholder after a satisfactory inspection.
As mentioned earlier, job insurance is not available as an independent policy, it is available as an add-on cover along with certain policies.
Let us have a look at some of the plans that come with the benefit of a job insurance cover: