Sadly, some individuals are not even aware that they do have the option of taking loan protection insurance cover independently. Instead, they believe wrongly that the cover has to be taken out at the time of borrowing. The high street lenders do nothing to dissuade them otherwise because they make profits in the region of £4 billion from selling.
Every individual has the option of shopping around and comparing quotes for loan protection insurance cover. Simply by taking the time to do this you can make savings often in the hundreds of pounds bracket. Do not be conned into believing that the loan is dependent on taking out the policy. You not only make savings when going with specialist providers. You also gain access to all the information needed to be able to determine if loan protection is suitable. Other policies might better suit your needs.
Loan protection insurance cover is taken to safeguard against the possibility that during the term of the loan you might lose your income. It will protect against becoming unemployed due to such as redundancy or through being unable to work due to an accident or illness. The exact terms and conditions of policies do vary so checking the key facts is essential. They will tell you when the policy would begin and end and give information about exclusions that could apply.
The majority of loan protection policies would kick in and provide an income that is tax-free between the 30th and 90th day. It would then continue to provide the security and peace of mind of an income for between 12 and 24 months. Some providers can backdate their policy to the first day of being unable to work or becoming unemployed.
Faith in financial products is at an all time low after it was revealed in 2005, there had been widespread mis-selling of payment protection policies. The Office of Fair Trading and Financial Services Authority (FSA) both began an investigation into the sector. This resulted in several well-known names on the high street being given fines. While some changes have been made for the better more are in the pipeline with the introduction of comparison tables by the FSA.
The tables will highlight all the information needed. It will show the consumer how much a policy would cost and make them aware that there can be exclusions in a policy. It will also help the consumer to make the right choice when it comes to buying a policy. While loan protection cover can protect your loan and credit card repayments, other policies might be more suitable. This will be made possible by the consumer answering a series of questions relating to their circumstances.
Instead of leaving yourself without a backup plan individuals should remember that it is not the products which cause problems. It is firms who sell cover without experience and who fails to give the correct information at the time of selling that has caused problems. Providing you read the terms and conditions that are provided by an ethical provider on their website before buying. Your loan protection insurance cover will protect you.
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