When you take out an online loan, you may be offered additional insurance. Therefore, it is worth considering whether we should invest in this service.
What is loan insurance?
It’s really life insurance. In the event of the debtor’s death, his family will not inherit the debt, and the obligation he incurs will be repaid by the insurer. From the perspective of a loan company, such a service has so many advantages – the company can be sure that the debt will be repaid regardless of the circumstances.
What can I gain from it?
Loan insurance is primarily a guarantee that we will not burden our family with debts. Other costs such as an administrative fee or commission are only intended to generate a profit for the loan company. Insurance has benefits for both parties – the lender and the borrower.
How to buy insurance?
In the case of online loans, simply check the appropriate box in the application form and additional insurance will be included in the cost of the loan. Before submitting the application, it is worth checking what lender offers insurance conditions. It is also best to analyze the so-called exclusions and exceptions where the insurance company does not pay compensation.
Can I opt out of insurance at any time?
Loan companies often don’t give up margins or commissions earned on insurance sold so easily. Hence – additional costs may be associated with the resignation from this service, e.g. reduction of the loan repayment time. Withdrawal from the insurance contract may reduce the total loan amount, but it is worth, before making a decision, to read the borrower’s regulations and analyze all the pros and cons.
Don’t make hasty decisions
Before taking out a loan, it is good to analyze all the offers and choose the best one. You should not be afraid of insurance, because its costs should be clear from the very beginning – we know what we are choosing. It is good, however, to check whether a particular company is offering a loan with insurance at a competitive price. Hurry is not a good adviser, especially when you take out a loan.