Unsecured Loan Insurance
Not to be confused with PPI or Payment Protection Insurance, Loan Insurance is all about covering yourself if you cannot meet your loan repayments set out in your policy.
Loan insurance essentially covers your back if you become unemployed, sick or unable to work through no fault of your own. It offers great security and is available to cover pretty much any loan policy that you may take out, home improvement loans, loans to buy a car, personal loan or anything else you can think of would be covered if you have loan insurance.
Why do I need Loan Insurance?
Loans are tricky, they are often the start of becomming ridden with debt if the holder cannot meet the repayments, for this reason loan insurance is worthy alone but there are many other reasons why you should have loan insurance.
Essentially though if you are taking out or applying for a loan to pay off other loans, personal debts or a necesity good the chances are that you may be involved in difficulties with repayments and debts in the future. With this added cloud hanging over your shoulder it makes sense to take out loan insurance at the point of sale.
Loan insurance can be expensive, upto 20% of the actual size of the loan in some cases, but this added cost makes minimal different over a period of 5-10 years in fact a loan of £10,000 over a period of 10 years would only be an extra £3 per week over the ten years if it had loan insurance attached. £3 for peace of mind? I would.
We are all guilty of saying “no, not interested” as soon as a lender mentions add-ons, insurance or whatever it may be. But I urge you to look at loan insurance as it could prove to be your downfall, avoidable with only a small extra payment on your policy.