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H o r e n b e r g I
n s u r a n c e S e r v i c e s, I n c.
|
 Credit
Life Insurance |
| Summary |
|
Credit life insurance is written to cover a specific debt such as a mortgage or car loan. The policy pays off the underlying debt in the event of your death. Credit life is often bundled with credit disability and included in quotes for loans and mortgages. It is also marketed heavily by credit card companies. Premium payments may be included in the loan payment or automatically added to the credit card account. |
| Advantages |
| The advantage
is that no medical underwriting is required so the policy is issued
regardless of your health. The disadvantages include: 1) the death
benefit decreases as the loan is paid down; 2) the premium is usually
higher than the same amount of level term insurance; 3) there are
no coverage or convertibility options; and 4) the policy is for
the benefit of the lender rather than your family. Credit life is
generally not a good choice unless you have a medical condition
that makes other types of life insurance unavailable or cost prohibitive. © 1999 - 2003 Horenberg Insurance Services, Inc. |