Loan Protection Insurance: What Is It And When Might You Need It? - Pearl Financial

Loan Protection Insurance: What Is It And When Might You Need It?

By Shane | Insurance

Feb 08

Loan protection insurance is intended to help policyholders by providing financial support in time of need. It’s an insurance that can help protect your monthly loan payments and protect the you from default, whether your need is due to disability or unemployment. Do you know how you or your family would meet the mortgage repayments if you lose your job, suffered a serious injury or illness, or even died?

If you haven’t thought about that yet and you haven’t planned to protect your mortgage, you’re not the only one. Sad to say, but most people don’t even like to consider loan protection insurance even though they are aware that they might need it in the future.

Having loan protection insurance can pay off when you select a policy that is comprehensive and will provide the coverage that is suitable for you.

Be sure to know all loan insurance terms, conditions, and exclusions before you sign up. Policies may also vary from company to company so check terms and conditions of the coverage to see what exclusions and clauses are included in the policy. Consider looking for a specialist insurance broker or speak to a mortgage broker that offers this service if you think that loan protection insurance is something you need. You also have the privilege to choose whether to buy the insurance separately or at a later date, which can definitely save you hundreds of dollars.

Only obtain the policy that best applies to your needs and present situation or else, you’ll actually have to pay more than you have to. Look for a reputable company and always read the terms, conditions, and exclusions of the policy thoroughly before committing yourself. It’s not necessarily suitable for everyone’s situation. You may also have to assess your financial situation just to be sure that getting a loan protection insurance is the best approach for you. You must be able to address all personal and current issues before coming up with such an important decision.

 

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About the Author

Shane specialises in helping Gen Y professionals and business owners make an impact by accumulating more assets, generating more income, and having more time to enjoy life. He has a Master of Applied Finance, an MBA, and a Master of Financial Planning. He is also a terrible golfer.

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