Now, unemployment cover plan to make pink slip less painful

Private life insurer Bharti AXA General Insurance is gearing up to launch an unemployment protection cover plan that will cover the risk of being laid off.

Updated: Sep 19, 2012, 10:05 AM IST

Zeebiz Bureau

New Delhi: With many companies laying off employees and few new jobs being created, the risk of unemployment has increased. One does not know who or which sector will cut workforce in the future.

Private life insurer, Bharti AXA General Insurance, is gearing up to launch an 'unemployment insurance’ product that will cover the risk of being laid off.

The product, at present, is awaiting the regulator’s (Insurance Regulatory and Development Authority) approval.

Earlier, another general insurance player, ICICI Lombard, had come up with such a product in 2009.

Unemployment insurance is a new product in the general insurance category in the country, though it is a very popular product in the western world.

The unemployment benefit is only for a limited period and you will have to claim for the job loss feature only to pay three months of your equated monthly instalments for home or auto loan.

There is a waiting period of 30-90 days before you can claim for a job loss. Your claim will not be honoured if you lose your job before the commencement of the policy or if it is impending at commencement of the policy.

Your claim can be refused if you lose your job on the grounds of a pre-existing disease or if you refused an alternate employment by your employer after it sacked you.

These policies can be taken for anywhere between one and five years. But, you can claim only once during the policy term.

If you are sacked when above the age of 50, you cannot claim for loss of job as these policies cover those in the age group of 20-50 only.

According to experts, as the country becomes more economically integrated with rest of the world and faces cyclical downturns in its economy, the demand for such products will grow in the coming times.

Bharti AXA General Insurance is a joint venture between Bharti Enterprises and AXA group in which 74 percent stake is held by Bharti group.

The France-based AXA group is a global player in insurance and asset management, had a revenue of 91 billion euros in 2010.

With Agency Inputs