Nike shoes, Nike shoes France - Is Loan Protection Insurance Worth The Cost?
Is Loan Protection Insurance Worth The Cost? Despite the bad publicity surrounding loan protection insurance, it is still worthwhile to consider whether a policy would be in your best interests. The cover has come under fire, but it is not the actual product that should be the cause for concern; rather, it is those who sell it with very little experience. The majority of mis-sold policies are bought alongside loans at the time of borrowing, with high profits being prioritized over the consumers' best interests. This is not surprising when you consider that high street lenders bring in profits of over £4 billion each year by selling payment protection insurance policies alongside loans and mortgages.
Cover bought alongside loans often comes with the highest premiums. By choosing to take out the cover independently, you can make huge savings on the cover along with getting the information needed to make an informed decision. It is the exclusions which have caused the majority of problems—or rather, the lack of knowledge about them at the time of being sold the policy. Common exclusions in most loan insurance policies include part-time employment, pre-existing medical conditions, being of retirement age, or working only part-time. There can be others set out by the provider, so it is essential that when you compare quotes for the cover, you also compare the exclusions. The exclusions can be found in the small print of the policy, and a specialist provider will always offer this information before you buy the cover.
If loan protection insurance is suitable for your circumstances, it can provide you with a tax-free income to pay your monthly loan repayments and help you stay out of debt. If you were to leave work due to an accident, illness, or unemployment, you would still have to continue repaying your loan or credit card each month. Without a lifeline, you could find yourself getting into debt or worse. Cover could begin to payout from between the 31st and 90th day of being continually out of work and would then last for between 12 and 24 months, depending on the provider. This means that you would not be struggling to find the money each month and can have peace of mind until you get back on your feet and return to work.
By sticking with an independent specialist provider, you can be sure that you will get the information needed to ensure that a policy would be suitable for your needs. Along with this, you will get the cheapest quotes possible for the cover, which will be based on your age at the time of taking out the policy and the amount of your monthly loan repayments. Always avoid taking out the cover alongside your loan and make sure that you check the cover has not been included in the cost of the loan or credit card, as some lenders will give you a quote for the loan with loan protection insurance already included.