What is the purpose of unemployment insurance?

The purpose of unemployment insurance is to assist with financial needs during periods of unemployment. This program is designed to provide temporary financial support to individuals who have lost their jobs through no fault of their own, helping them to meet essential living expenses such as rent, food, and utilities while they search for new employment.

Unemployment insurance typically comes from payroll taxes that workers and employers contribute to, ensuring that there is a safety net for those experiencing job loss. This support can be critical for individuals and families, allowing them to maintain a basic standard of living during challenging times and aiding in economic stability by helping people avoid poverty during unemployment.

The other options do not relate to the core function of unemployment insurance. Purchasing a home, investing in stocks, or covering healthcare costs do not reflect the primary objective of providing temporary assistance during job loss.