Payment protection should be made easier to understand
- 24TH SEPTEMBER 2007
Despite it earning itself a less than favourable name, when bought to suit your circumstances payment protection insurance (PPI) can still be a very valuable product when it comes to lending a helping hand in times of trouble. If you were to suddenly lose your income and have no money spare to fall back on then you could suffer financially when it came to how you would keep up your loan or credit card repayments.
While the majority of lenders do help in times of trouble and understand, catching up with even just one month’s repayments could mean a whole host of angst and start you off on a downward spiral to debt problems. If you were out of work for 5 months or more than you would be in serious trouble with your repayments unless you had a safety net on which to fall.
Providing a payment protection insurance policy is suited to your needs then it could be your financial safety net. It will give you an income each month with which to meet your mortgage repayments and would start to pay out after you had been out of work for typically 30-90 days and would continue to provide a fixed tax free sum of money for up to 12-24 months.
While payment protection insurance can be a lifeline you could also hang yourself with it if you don’t understand what the product is and is not capable of doing. There are exclusions in all policies and this means that you might not be able to claim if your circumstances fall into certain categories. Those who are self employed, retired, only work part time or have a pre-existing medical condition wouldn’t be able to are excluded from the majority of cover.
Buying payment protection insurance from a standalone provider such as the ethical British Insurance is always your best choice when it comes to getting not only the cheapest premiums but also the vital information you need to ensure a policy is suitable for your requirements.
