Unemployment income protection insurance is protection for your own monthly income against redundancy and can be taken out with a specialist provider which would allow you to be able to search for the cheapest premiums. Suddenly losing your income can have devastating consequences on not only you but also the rest of household and a policy could stop you from having to face these.

You can take out unemployment protection insurance by choosing the amount of your income you want to cover. This amount, providing it is pre-agreed by the provider is the sum of money that you would get back should you find yourself a victim of redundancy. You would be eligible to make a claim at anytime in your life should redundancy happen as long as you were paying the monthly premiums. You would get the income back each month for the term offered, as tax free payments, which would usually be between the 30th and the 90th days of your unemployment. Some providers will offer to date back the protection to the first day of you losing your income to redundancy so check this in their terms before taking on the policy. Once you have begun to receive payments you continue to receive them on a monthly basis until the 12th month or the 24th month, depending on the provider, if you should need to claim for this length of time. After this period of time the protection policy ceases, however during this time you could have found work or have made a recovery.

With your unemployment income protection insurance behind you and the income you would gain back each month from it you would not have to make the drastic changes you might have to if you did not have the income fall back onto. You could use this income in any way you wanted by paying any essential bills that might drop through the letterbox during your unemployment. You could for example choose to use some of the replacement income to meet the demands of your utility bills. You would also have the money to be able to do the monthly food shopping without worry. If you had rent to pay then you would also not have the worry of finding that money each month, at least for the term of the cover.

Unemployment income protection insurance could be more reliable as a backup plan than considering using your life savings. For one you could make a huge dent in these savings and they might not last for the duration of your unemployment, which again would leave you struggling. A policy could also provide more financial security than if you risked applying for State benefits. You would have to prove you were entitled to receive benefits and even if you should be eligible the little money you might get might not be enough to maintain all of the essential outgoings you need to service each month.

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