We have been promoting a new service for borrowers – credit insurance!
This is nothing new – banks have been offering mortgage insurance for a long time, given the size of their loan amounts and maturities. However, consumer loans can now be insured. Insure the loan and, if you are unable to repay, the insurer will perform the debt service on your behalf.
Find out which company offers credit insurance already in the price of the loan and find out what the insurance terms are.
At present, you can insure all loans where the amount of the loans is large enough to be worth taking advantage of such an offer and have a repayment schedule of at least 4 months. Consult your preferred lender for specific credit insurance options. Choose a lender that offers good insurance terms.
The amount of the monthly insurance payment will depend on several factors, first of all, the size of the loan and the repayment term. The higher the amount you borrow, or the longer the loan repayment period, the more logically the monthly insurance payment will be.
An insurer could claim a higher insurance premium based on the age or health of the borrower. There are creditors who have already included insurance in the price of the loan and you already receive this service automatically.
Unlike banks that offer credit insurance in the event of job loss or temporary disability, non-bank creditor insurers may not offer this option. The loan can be insured only in case of severe disability or death of the borrower.
If you insure your credit, you will protect yourself or your family from future loan payments in the event of a major accident, but in the event of a dismissal, you will not be exempt from paying the loan.
However, in order to guard against fraudulent and intentional accidents, insurers will have specified in the credit insurance contract the specific cases in which the insurance compensation will not be paid. First, the credit insurance compensation will not be refunded if you intentionally cause an accident that will lead to disability or death.
In other words, if you have caused a traffic accident, committed any other unlawful act, or intentionally injured yourself, you will only have to repay the loan yourself.Secondly, insurers also determine the countries in which the accident will not be covered.
The cover of credit insurance
Insurance coverage will also not be payable in the case of other life-threatening activities, such as trying to get down a kite or floating the ocean on a bottle raft, rubber jumping, mountain climbing or surfing. If the accident occurs under the influence of any intoxicants, the insurer will also be able to refuse to pay you compensation.
Each insurer will determine the risks for which no compensation will be paid, these risks will all be covered by the insurance contract and you will be able to read them before deciding whether to insure the credit or not. It will also be the insurer who will assess each accident individually and make a decision accordingly.
If you are an honest person who does not knowingly put yourself at risk of life and you want to cover yourself against unexpected disasters, credit insurance is a valuable service worth asking your non-bank lender for a longer period of time because unfortunately we cannot predict what with we will be tomorrow or in the future.
The monthly insurance payment will be less, but the benefits in the event of an accident will be huge.