With the economy in its current state, job security is scarce. In 2021, around 740,000 people lost their jobs amid the COVID-19 pandemic. Many companies could not maintain their usual workforces, a phenomenon currently repeating due to the state of the economy. As the country tries to recover from the pandemic, supply chain issues, inflation, and poor policy contributed to an unstable economical environment. The unemployment rate was at a record high in 2020 at 10.4%. However, in 2022 the current rate is at 6.6%. Statistics also show that the country is facing its worst joblessness crisis.
For many people, this means going long periods without a steady income. However, it turns out that there is a light at the end of the tunnel. NonieMG posted on Twitter about how employment insurance can help people who have just lost their jobs have a nest egg until they return to work.
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Why should you get employment insurance?
Employment insurance provides temporary income support for some time while you look for another job or try to upgrade your qualifiable skills. In other countries, banks can also provide support when an employee goes through pregnancy, treatment for illness, or caring for someone sick or at risk of death.
The insurance only applies if an employee has paid premiums within the past year and meets qualifying conditions.
How do you get employment insurance in Kenya?
Some banks and insurance providers give insurance to people who qualify for their programs. However, these programs don’t apply to people over the retirement age of 65.
Many providers have a specific fee based on your chosen plan. If you have a salary of a certain range, you’ll pay different premiums for the support over various periods. Many insurance providers give support for six, nine, or 12 months. They may also need you to be customers with their banking service.
The employment insurance policy usually has a waiting period. In many, you won’t get access to the payments from the moment you sign on until about 9 months for some providers.
The documents you are likely to need are:
- Fully completed and signed claim Form
- Certified ID and policyholder’s identity document
- Copy of Retrenchment letter, Employment contract, and termination notice
- Copy of Bank Statement and payslip at the date of retrenchment
- Proof of account where the benefits should be paid into.
In addition, retrenchment insurance is inapplicable for people who lost their jobs in:
- voluntary retrenchment
- fraud, dishonesty, or illegal conduct,
- striking,
- political activity,
- civil commotion, or rioting.
- family business or self-employed
- part-time employment, or on contract expiry
The employment insurance is also not applicable for employees who, at the start of the policy, were aware of an ongoing retrenchment exercise within their company.
Usually, it’s only applicable to those retrenched because they became redundant due to the employer finding a new way of doing business or the employer truncating the workforce. They must also have been employed for at least 12 months before being retrenched.
Benefits of Employment Insurance
1. Income support
The main benefit you get from employment insurance is temporary income support after being retrenched. Financial assistance helps you meet your expenses without tapping into your savings. It provides peace of mind while you search for a new job or decide to redirect your life.
2. Debt cover
You will be better able to keep paying for short-term loans or credit card payments with retrenchment cover. Some companies offer comprehensive insurance which directly covers your debts for the period you’ve applied for. In addition, it helps you avoid defaulting and accruing penalties and higher interests.
3. Safety net
The Kenyan law only gives a provision, for workers made redundant, severance pay of not less than 15 days or being paid their remaining leave days in cash. This doesn’t provide much safety for workers who will end up having to rebuild their lives. Retrenchment cover is an affordable way to ensure you’re protected especially if you work in a field or institution that is prone to job cuts due to circumstances outside human control like automation.
Some covers provide for salaries starting as low as Ksh. 10,000. This ensures at least most workers can get retrenchment cover. These are some of the reasons you should consider employment insurance cover.
Check out
Retrenchment: What To Do When You Get Laid Off
Career: Signs You Are About To Be Laid Off Or Fired
7 Ways To Deal With Major Life Changes
Finances: Money Saving Tips To Survive A Loss Or Reduction Of Income
6 Ways To Deal With Unemployment
How To Manage Finances When One Partner Loses Their Job
9 Important Questions You Need To Ask Your Agent Before Getting An Insurance Policy
To Insure Or Not To Insure? Six Insurance Products To Consider
