Principles of Risk Management and Insurance, 13th Edition

Unemployment Insurance

Unemployment insurance programs are federal–state programs that pay weekly cash benefits to workers who are involuntarily unemployed. Each state has its own unemployment insurance program. The various state programs arose out of the unemployment insurance provisions of the Social Security Act of 1935. Unemployment insurance has several basic objectives:

• Provide cash income during involuntary unemployment.

• Help unemployed workers find jobs.

• Encourage employers to stabilize employment.

• Help stabilize the economy.

Weekly cash benefits are paid to unemployed workers during periods of short-term involuntary unemployment, thus helping them maintain their economic security. The second objective is to help unemployed workers find ...