|CREDIT LIFE AND DISABILITY INSURANCE
Credit life insurance, a form of decreasing term insurance, protects creditors such
as banks. The borrower pays the premium, generally as part of the credit transaction,
to cover the outstanding loan in the event he or she dies. The face value of a policy
decreases as the loan is paid off until both equal zero. When loans are paid off early,
premiums for the remaining term are returned to the policyholder. Credit accident
and health, a similar product, provides a monthly income in the event the borrower
Questions Your Clients Should Consider:
- How would they meet their obligations during an extended disability period?
- What percentage of their income would they receive if you were off work due
to sickness or injury?
- What impact would their death have on the financial security of their family?
- Doesn't it make sense to protect all the things they worked so hard to get?
The Payment Protection Plan is designed to provide a benefit for your clients that will
pay their loan in full in case of death and to make payments to their creditor if they are
unable to work due to sickness or accident.
The benefit Protection Plan will protect your client's initial investment in the loan and,
more importantly, the disability coverage will protect their good credit. Payments are
made directly to their creditor and therefore are not taxable.
Any individual, regardless of the hazards of his/her occupation, who is actively
employed at the time the indebtedness is incurred, subject to policy age limitations
and health requirements may qualify for the protection plan.
If your client is unable to work because of a sickness or accident, the plan pays your
regular installment payments for as many days or months as he or she is disabled,
limited only by the waiting period in the policy and the number of months of your loan
contract. If your client's loan is current, and they die before their debt is fully paid, the
plan will pay off the entire unpaid balance, subject to policy limits.
The cost of the plan is not more than a few dollars each month, depending on your
client's balance and its included in their loan's monthly payment.
Answers to General Questions about the Payment Protection Plan:
Q. Who determines whether or not your client is capable of working?
A. Your Client's family physician.
Q. Does your client have to be hospitalized to be eligible for the benefits?
A. No, your client does not have to be confined to bed, home, or a hospital. Your
client need only to be under a physician care and unable to work.
Q. Is their a limit to the number of times your client may be disabled?
A. No, as long as each disability is covered under the terms of the policy.
Q, What disabilities are not covered?
A. Disabilities caused by:
- Pre-existing illness, disease or physical condition;
- Pregnancy, except miscarriage caused by accident;
- Intentionally self-inflicted injuries.
Q. How complicated is filling a claim?
A. In practically every case requires a periodic report from your client, his employer
and his doctor is all thats needed. Just have your client write us or the creditor and
we will send him a claim form and instructions for completing it.
Q. Are both husband and wife protected?
A. Joint life is available in most states (subject to regulations set by the state in which
Q. Do many people buy the Payment Protection Plan?
A. At year end 2003, $153 billion of credit life insurance was in force.
Q. Who needs life protection on their loans?
A. Anyone whose death would cause a hardship on the financial stability of their
Financial Security Solutions can offer your Organization:
- (SINGLE PREMIUM)
- SIMPLIFIED HEALTH QUESTION
- EXTENDED LIMITS OF COVERAGE
- DISABILITY ONLY INSURANCE
- LOAN OFFICER INCENTIVE PROGRAM
- LOAN OFFICER TRAINING
|Copyright 2008 Financial Security Solutions Inc.
Financial Security Solutions, Inc.