What Is Redundancy Payment, Can Your Income Be Protected?

By Author: Kirthy Shetty
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Learn ways to stay cool even in times of redundancy. Due to unavoidable circumstances, you may have to be out of job. But, that does not stop you from living your life. Does your life end here? No, you must live on and support your family, in order to continue getting paid a continuous flow of income you must have a redundancy protection insurance.

Protection insurance policy - is indeed your friend!

Some companies have a policy of paying out compensation for those employees who have been with them for more than two years. This has been made compulsory if the employee has been asked to leave. If the reason is low performance, then no compensation will be paid. Some may pay you a compensation based on your age, tenure of service etc.

An employer must be able to demonstrate on what grounds has he laid off an employee? They must have reduced the organisation size as they feel that certain departments or operations are no more required and an employee who has been laid off must have been employed earlier to carry out those operations which are now made redundant. In such a circumstance, a compensation will be ...
... paid by an employer compulsorily, but the employee should have been in service with them for more than two years.

It is advisable to apply for a redundancy protection policy when you are in service so that you can combat the financial turmoil in your professional and personal life. This will protect your mortgage or other loan payments. If you are out of job and are indebted, your financial problems will be doubled. The best way to tackle this is to be protected under an insurance protection cover.

If your spouse isn't working and you were to be laid off owing to your company facing economic crisis, problems may get worse. While your insurance company pays out a compensation to you for your mortgage payments and other financial obligations, you can try your luck at freelancing jobs.

Up to 70% of your total income will be paid as compensation to you. This may change depending on your pay scale. You can use it up to pay your mortgage, loan or any other bills. Sometimes such redundancy insurance cover may even be provided along with the loan. In such cases, the payment made by the policy will go towards settling the specified debt.

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