What Life Insurance Do I Need To Cover Loan Payments If I Am Out Of Work?
Posted February 22, 2010 – 10:48 am in: structured settlements FAQNot sure if normal Insurance covers this I did not take the loan insurance it was too expensive
Tags: Cover, Insurance, Life, Loan, Need, Payments, What, Work
6 Comments
lifeinsurance.awardspace.info – try this one. I have their insurance and, as remember, they can provide such a service.
There are few options. Your loan might offer wavier of premium (this means if you don’t get paid they pay the loan payment). You can also get redundancy insurance (but this is expensive). Or a payment protection plan. Wavier is the best as it is usually cheapest, then payment protection, but shop around and finally redundancy protection.
Do you mean life insurance or payment protection?
Life insurance pays out a lump sum if you die. Unless this is a joint loan, your estate will pay the loan if you die or it will die with you if your estate is too small. If you have a spouse or financial dependants, or if you want to protect your estate, you should consider life insurance.
Other insurance policies that cover loan repayments are; Payment Protection , Income Protection and Accident Sickness and Unemployment (ASU). Waiver of Premium does NOT apply to a personal loan. You don’t pay loan ‘premiums’, instead you make repayments. Waiver of Premium applies to certain insurance policies and pensions, for example, where the premiums will be waived (actually paid by the provider) if you can’t work for a certain period of time.
Payment Protection Insurance (PPI) and ASU are quite similar. They pay the loan repayments/money each money to cover the loan if you are unable to work because of illness, accident or redundancy, but only for up to 12 months usually.
Income Protection insures your salary. If you can’t work for a certain period of time, the policy pays you a monthly income until you die, return to work or retire, whicever happens first. If you are a housewife/husband, you can get some cover based on your ability to perform certain functions e.g. walk a certain distance, get dressed etc.
If you are out of work anyway, redundancy insurance is useless to you. Presumably you claim benefits or rely on someone else for an income. Why do you need insurance therefore? You – personally – have no risk. You could look at Income Protection on Houseperson’s benefit, but it depends on your overall financial circumstances.
Speak to an Independent Financial Advisor (not your bank) for some specific advice.
I hope this helps.
KInd regards.
Disability insurance is a great thing to have if you are out of work due to illness or injury. If you are out because of layoff, then the only thing to get is some of that credit card insurance (way too expensive in my opinion) or start saving up an emergency fund of three months’ expenses in a savings account.
Hi louise
check this site for help, they give you info on life insurance from different companies http://www.mb01.com/lnk.asp?o=1849&c=918273&a=36503
I think it is payment protection cover.