card guide
Do I Need Loan Insurance? [Part 7]

One of the biggest money-spinners lenders have is convincing borrowers that they need to take out insurance on their personal loan in case they lose their job.  First of all; yes, there is a place for personal loan insurance coverage.  Moreover, any prudent borrower should give this serious consideration.

However, it may not suit all.  For example, if you are self-employed, then the insurance may not cover you if your work dries up as, technically, you’ll not have lost your job.  Also, most insurance policies are

(a) strict on the fact that you do not work if you claim, even part-time work, and
(b) have a maximum period in which you can claim on the benefit. 

The problem with the latter provision is that you may have been paid redundancy when you lost your job, which itself may debar you from invoking the insurance.  However, once the redundancy has erode to a level where you can claim, the 60 day exclusion kick-in.  Furthermore, some insurance policies don’t cover you if you lose your job due to ill health.

Consequently, all of these need consideration.  Only you will be able to tell if the insurance is going to be worth the additional monthly insurance premium cost.

Finally, some lenders try to tell borrowers borrowing large sums of money on a personal loan that the personal loan insurance is a compulsory condition to the granting of the personal loan.  If this is the case you should be cautious about going through with this.

Posted on: [ January 05, 2018 ]       Add to   Digg it   Add to Blinklist   Add to FUrl   StumbleUpon