Unemployment Insurance in Chile
Unemployment Insurance is a very important instrument in the field of social protection in Chile. It was created in 2002,1 with the mandatory inclusion of all workers who had initiated a work relationship in the private sector from October 2002 on, and the voluntary inclusion of all workers with work contracts subscribed prior to that date.
Its specific design and features make the Chilean Unemployment Insurance a unique system, with an individual savings component and an insurance component. The individual savings component provides a monetary allowance for private sector workers during periods of unemployment, and is complemented by a component of the system called the "Solidarity Unemployment Fund." This fund includes contributions by both the State and employers, and may be used only when a worker with an open-ended contract is fired due to "company needs" or "force majeur," and in the case of fixed-term workers or workers hired for specific works and services, after their contracts have expired.