Le of Insurance
Tata Consultancy Services Limited (TCS) has decided to lay down around 12,200 employees in this financial year, which will affect mid and senior level employees. The country’s largest IT service company is trimming its biggest in its history. The reason for this is to adopt focus on skills prepared according to the future and adopting AI on a large scale. In such a situation, Job Los Insurance, which very few people used to take earlier, have now come into the discussion again.
What is a job loss insurance?
If someone’s job suddenly goes away, the job loss insurance helps a person to run the necessary expenses. It supports until another job is found. It helps in covering the necessary expenses like loan installments, rent, electricity-water bills and medical expenses so that you do not have to put hands in saving.
According to Gurdeep Singh Batra, Executive Vice President of Bajaj Allianz General Insurance, this is a good option for those who are worried about going to the job. Especially in sectors like IT, startup and manufacturing where repeated trimming has become common and is not limited to just recession.
How to work and premium
The method of payment in Job Los Insurance is already determined. Some policy gives money every month for some time, some give full money together. Most of the policy contains the fixed model in which the person gets the fixed amount every month while being unemployed. But the payment starts only when the person remains unemployed continuously for a few days.
Usually a person gets up to 70% of his salary, but it can be different in different insurance companies. Giving the example, Batra said, someone can get up to Rs 10,000 every month for three months, it depends on how many days have been unemployed and what is the waiting period in the policy. He said, there are some policy in which the first month is Rs 5,000, Rs 10,000 in the second and Rs 15,000 in the third, so that the person is constantly looking for new jobs.
The premium of this insurance, the person’s salary, the duration of the policy, the job risk and in the group, depends on these things. Batra said, the premium in the group policy from the company or bank is low. The premium also depends on industry or job rolls. The premium may be high in high risk sectors.
Who can take job loss insurance?
This insurance is only for salary employees of the formal sector. Whether the employee is in a multinational company or in a startup, if the company comes in the formal sector, it will be covered, it is said that Sajja Praveen Chaudhary, who is the director of the policy market for business.
Job Los Insurance usually covers business and involuntary unemployment caused by medical reasons. Chaudhary said, if someone has been taken out due to changing structure in the company, reducing spending or government order, then it will be covered. If you look at the current examples, this can be covered even if the job in the company is going to work.
Claim will not be available in these cases
- Those who do their own work or already unemployed
- On leaving a job in trial period
- On early retirement or resigning of your own choice
- On leaving the job due to any disease before
- Performance malfunction, fraud or suspension when the job goes away
When can the claim be rejected
According to Batra, this product is still new in India, so the rules of each company may be different. Generally, there is no claim if he is resigned, retirement, job in trial period or being fired due to indiscipline. Apart from this, if the job is not on contract based, seasonal, temporary or direct payroll of the company, then the claim will not be available. Claims will not be found even if there is a separate coverage in the policy even if there is a separate job even if there is a job in conditions like illness or epidemic.
Is it right to take this insurance?
It takes this safety net to see but there is a screw in it. Many big companies pay salary for 3 months at the time of retrenchment, after that the employee has to resign himself. Which is considered a voluntary resignation on paper. Chaudhary said, companies do this so that there is no stain to get out of the employee’s career. Nobody wants it to be written in his resume that it was evacuated, so companies provide this facility.
But it is considered a voluntary resignation on paper, so Job Los Insurance’s claim is not available, until the employee proves that he was removed.
There should also be these options at such a time
- Keep emergency funds ready: save as much money as expected for 6 months so that there is no problem when the job suddenly goes.
- Take insurance with a loan: This makes the loan of the loan to fill the loan and your property is safe when you go to the job.