Should you buy Supplemental Unemployment Insurance

by Suba on May 4, 2012 · 8 comments

Unemployment is one of life’s setbacks that can seriously damage a person’s financial security. It can happen to anyone, even you.

State unemployment insurance may be available to you, but will it be able cover all your bills and expenses including mortgages and loans? During those times when you know that state unemployment insurance is just not enough, it is the time when supplemental unemployment insurance comes in handy.

Supplemental unemployment insurance is payments you can receive on top of your state unemployment insurance during that unfortunate time of unemployment.

What benefits can I get from supplemental unemployment insurance?

The best benefit that you can get from supplemental unemployment insurance is that you can extra payments that will allow you to cover most of your expenses. This will help you to get you through the dry spell.

On top of the amount you are qualified to get from the state, you can get an additional amount to cover almost 50% of your former salary. With this amount you do not need to deplete your hard-earned savings to pay-off your obligations and expenses. You can expect to get 24 weeks of benefits after a waiting period of two weeks. Payments are distributed through checks, or they are deposited into your bank account.

Another advantage you can get from this type of insurance is that the payments are non-specific and pays in cash. This means that you can use the money for whatever expenses you need to pay. It does not specify whether it is exclusively for mortgages or loans.

Do I qualify for supplemental unemployment insurance?

The first thing you should remember if you are considering getting a Supplemental Unemployment Insurance is that you should be currently employed before you purchase the policy.

You are not eligible to buy a supplemental unemployment policy if you are already unemployed. You should also be working full-time for a company who has more than 50 employees.

You also have a waiting period of 6 months before the policy can be active. If you lose your job during the 6 month period, no compensation can be released to you, but all premium payments made within this time will be refunded back to you. It is important that you qualify first for state unemployment insurance before you can claim payments from supplemental unemployment compensation.

How much will it cost to get supplemental unemployment insurance?

The premium you need to pay will depend on the industry of your work, your current income level, and your geographical location, which is the state where your work is situated. It is about 0.5% to a maximum of 2.0% of your yearly gross wage. At most you can insure up to $250,000 salary coverage, but amounts more than that can be covered by the $250,000 level.

Where can you buy Supplemental Unemployment insurance?

Assura is a private company that developed the program IncomeAssure. IncomeAssure is an insurance policy that covers supplemental unemployment compensation. Presently, this program is available in 34 states across the United States and District of Columbia.

Unemployment may happen at a time when you least expect it. During economic recession, no one is spared from the negative consequences, such as mass lay-offs.

It is a good idea to have a backup plan so that your family can make ends meet. Even if you have more than enough savings to get you through the period of unemployment, you can never be sure how long it will take until you find a new job. Instead of exhausting your savings, wouldn’t it be best to be prepared and get the compensation necessary during those dire times of need?

What do you think about supplemental unemployment insurance? Would you buy it? Do you have it? If so, which company do you use? Since we are on the topic of insurance, why don’t you read 10 Tips for Saving Money on Car Insurance.


Suba is the editor of Broke Professionals.

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{ 6 comments… read them below or add one }

1 Shawanda @ You Have More Than You Think May 5, 2012 at 11:48 am

I wasn’t aware this type of insurance existed.

Before purchasing any insurance, I have to decide if I’m willing to accept the risk of self insuring. But if the premiums were reasonable and I was concerned about losing my job, I’d consider buying it. Since the benefits would only cover 50% of my previous salary over 24 weeks of unemployment, I’d be less inclined to buy the insurance if I had an equivalent amount of my salary stashed away.


2 YFS May 6, 2012 at 6:23 am

There is insurance for everything! I personally wouldn’t buy this type of insurance, I have no fear of losing my job. If I did lose my job I can get one withing 48 hours.. maybe for not the same money but our quality of life wouldn’t diminish too much.


3 John @ Married (with Debt) May 7, 2012 at 11:51 am

Wow, I didn’t even know this existed. If I ran the company I’d be worried everyone who applied knew they would lose their job.


4 Tackling Our Debt May 8, 2012 at 12:38 pm

I didn’t know that you could buy Supplemental Unemployment insurance in the US but I think it is a good idea. I know it isn’t available in Canada, and even the UI that we pay automatically per pay cheque only covers us up to 60% if we ever need it and a person only qualifies if they were laid off.


5 Van Beek @ Stock Trend Investing May 9, 2012 at 2:35 am

Supplemented unemployment insurance is not something that I am seeking. The related type of insurance I do have is against loss of income (unemployment) due to lasting disability as a result of accident or illness.


6 Jai Catalano May 9, 2012 at 6:36 am

This is the first time I have heard of this. I think once the numbers are crunched it needs to be seriously looked at. Even though things have gotten better we aren’t out of the woods yet.


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