By Victoria Heckstall

Losing your job and the medical insurance that most companies provide can put you in a difficult situation. Medical insurance is an essential part of your financial planning. If you are recently unemployed, you may be tempted to cut your insurance, as an unnecessary expense that you can no longer afford. However, this is an extremely risky decision, as you never know when a catastrophic event will affect your or your loved ones. Thankfully, the American government has made a provision for people who have become recently unemployed in an attempt to protect those who are in between paying jobs. This system is COBRA, Consolidated Omnibus Budget Reconciliation Act of 1986, a government creation that covers the medical benefits. people who have lost their insurance as a result of becoming unemployed.

Essentially, COBRA allows eligible applicants to extend their terms with their existing health insurance group for up to 18 months. This means that even if you do lose your job, part of your medical insurance will be covered, even though you no longer work for the same company. You may be deemed eligible for COBRA if your resignation was submitted within 60 days of your application for COBRA coverage, you were fired for any reason other than gross misconduct, and you were covered by your employer until the day before your job was terminated.  This means that if you are considering taking retirement, or you lost your job unexpectedly, you will still be able to cover » Read more: Insurance: Health insurance for the unemployed – COBRA