Understanding a loan protection policy
- 14TH SEPTEMBER 2007
Loan protection policies are not always the easiest of things to understand and the majority of lenders aren’t forthcoming with the information that they provide at the time of taking out the policy. This is one of the main reasons why the product has been mis-sold, leaving many people unable to claim on their loan protection policy.
A loan protection policy is taken out to ensure that you would still be able to meet your monthly loan repayments if you should be unable to work due to suffering an accident, from long term sickness or because of unemployment brought about by involuntary redundancy.
A loan protection policy, when bought to suit your circumstances, will provide you with a monthly tax free income which would ensure that you would be able to repay your loan without having to worry about where to find the money each month. It would begin to pay out after you have been unable to work for anywhere from 30-90 days, depending on your provider. Some policies will also backdate your claim to the first day that you were unable to work. A loan protection policy can continue to provide you with an income for up to 12 months in the majority of cases while some providers offer an income for up 24 months.
When getting quotes for your loan protection policy you have to decide if you want to take out a policy to cover against becoming out of work due to accident and sickness only; unemployment only; or for accident, sickness and unemployment together. The quotes for ASU insurance as it is sometimes called do differ from lender to lender and this is why it’s not only essential to shop around and get several quotes but to get quotes from standalone specialist providers.
British Insurance is one such specialist provider who can help you to make huge savings when it comes to your loan protection policy. Being an ethical specialist, British Insurance make sure that they give you the key facts regarding a policy in plain English, which makes deciding if a policy is suitable for needs easier. The exclusions are also laid out and this means that you can be sure that a policy meets your circumstances before buying it.
