Simply put, Payment Protection helps safeguard your loans.
If an unexpected life event leaves you at risk of defaulting on a major loan, Payment Protection could help you and your family when you need it most.
If you’re thinking, “That sounds a lot like life insurance,” you’re partially right. But Payment Protection and life insurance are intended to complement—not compete against—each other. Payment Protection offers a simple way to ensure your loans don’t become a hardship if you’re gone.
Here’s a closer look at two key differences between Payment Protection and life insurance.
The process
Many Americans receive life insurance solely through their job’s relatively small group policy. And these policies typically stay behind with the job if the holder moves on to a new company. Setting up a separate life insurance policy can be a bit of an investment of time and effort, usually requiring a medical exam, family history, and underwriting.
Getting Payment Protection is a much easier process since there’s no need for approval. Plus, the cost is added to your normal monthly loan payments, you’re covered the minute you sign, and you can cancel coverage anytime.
Expanded benefits
While younger borrowers might be less likely to think about the need for this coverage, they could have more use for Payment Protection than their older counterparts. With longer work lives ahead of younger borrowers, there’s a greater risk of disruptions interfering with their ability to work.
This risk is greater than you might think. The Centers for Disease Control and Prevention reports that one in four adults in the United States lives with a disability.
A younger borrower has a higher chance of disability than of death, so life insurance alone may not provide enough financial security. Disability coverage is just one of many benefits that Payment Protection provides. If the unexpected happens, Payment Protection can step in with expanded benefits, including:
- Life Enhanced. Beyond paying off the outstanding balance of your loan (up to policy maximums) if you pass away, this benefit also covers terminal illness, accidental dismemberment/loss of sight, hospitalization, family leave, and accidental death of a dependent.
- Involuntary Unemployment. This benefit makes monthly payments, for a maximum of six payments, during the life of a loan. IU also applies to the honorable discharge from military service.
Learn more
If you’re interested in learning more about Payment Protection and whether it’s a good fit for you, speak with one of our insurance specialists at 844-323-7550.
* Your purchase of Payment Protection is optional. Whether or not you purchase Payment Protection will not affect your application for credit or the terms of any existing credit agreement you have with the financial institution. There are eligibility requirements, conditions, and exclusions that could prevent you from receiving benefits under Payment Protection. You should carefully read the contract for a full explanation of terms.
