Government and private unemployment insurance is a program to insure workers against job loss. Both are options for any employed person, but there are differences between them. Private unemployment insurance can range in benefits and costs, it can also vary in which conditions are acceptable for pay out. Private insurance can supplement or replace government unemployment insurance, but the consumer should be extremely careful when accepting a private plan. Read fine print and ask questions to be certain you understand which conditions will result in a pay out and which circumstances could lead you to be ineligible for a pay out. Also, be clear exactly what percent of your income will be replaced if you suddenly lose your job. Because private insurance requires the consumer to pay a monthly premium, it should offer some incentives over government insurance, which relies on taxes paid by businesses to cover workers. Investigate your private insurer thoroughly.

Different from private unemployment insurance, government unemployment insurance, or, UI, is a program that is joint-run by the federal and state governments. It covers all workers in the case of cutback of hours, lay off, or other, faultless, job-loss. Government unemployment insurance relies on federal and state tax dollars paid by employers on employee wages. To apply for unemployment benefits, you must be completely unemployed or working less than full-time. You also must be able to work and looking for work, and you must not have been out of work for more than 18 months. Unemployment benefits are not available to part-time, temporary or self-employed workers.

In most cases, unemployment will cover your total wages, but in some cases benefits will cover only essential costs such as food or rent, or make up for lost wages if hours are trimmed back. After the application process it can take two weeks before benefits are being paid out. The maximum amount of time for benefits to be collected and maximum payouts vary by state. When you are reemployed your benefits will automatically stop. If you find part-time work or have other means of income it can effect the total amount of your weekly/monthly benefits. In almost all states it is possible to apply online or through the mail. Anyone applying should make sure they have his or her social security number, drivers license number, name and phone number of previous employer, and date of job termination, as well as other paper work as specified on the UI application or website for his or her state.

Government unemployment is a state-run program in conjunction with and backed by the federal government. Everyone who loses a full-time, permanent employment position due to layoff or other circumstances beyond his or her control, qualifies for benefits. Private insurance is another option, but if a company is offering private unemployment insurance, the company should provide some incentive over government insurance, such as coverage in the case of firing or choosing to quit a job.