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Credit Insurance
Credit Insurance Policies
Oh The Paperwork!
Credit insurance is a term used to describe both trade credit insurance and credit life insurance. Credit insurance is sold in connection with a loan, a credit card or other credit account and is designed in such a way as to make payments to the lender for you if you are unable to make the payments yourself.
Credit insurance is available from only a limited number of insurance carriers who specialize in this unique type of coverage.
Credit disability insurance Policies
Credit disability insurance, also known as accident and health insurance, makes payments on the loan if you become ill or injured and can't work.
Credit insurance is connected directly with a particular loan or a credit card. It applies also to other types of credit account and is designed to make your payments to the lender for you if you are unable (for specific reasons like involuntary unemployment or sickness) to make the payments yourself.
Loan insurance Policies
The next time you apply for a mortgage or personal loan, you may be asked if you want to buy credit insurance, or it might already be included in your loan proposal.
In fact, the Federal Trade Commission (FTC), the nation's consumer protection agency, says it's against the law for a lender to deceptively include credit insurance (or other optional products) in your loan without your knowledge or permission.
In fact this is true in many counties around the globe.
The lender cannot require that you purchase credit life, unemployment or disability insurance as a condition for obtaining a loan.
Consumers Protection
The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them.
Consumers always have the choice to choose credit insurance or turn it down.
This again is true in many countries around the world.
Monthly Premiums
The Monthly Premium for open-end loans, your monthly premium is calculated by multiplying the outstanding balance in your account on the account’s monthly billing date by the premium rate or by multiplying the average of the daily loan balances during the previous month by the premium rate.
More About Credit Insurance
Credit insurance is available on just about all types of personal loans including both closed-end and open-end loans.
Credit insurance is offered more and more, so if you haven’t heard of it yet, chances are that you will. Credit Insurance is an insurance policy associated with a specific loan or line of credit which pays back some or all of any monies owed should certain things happen to the borrower, such as death, disability, or unemployment.