Credit Insurance – Bank Loans
When we withdraw credit from banks or other financial institutions, we first consider and prepare to return money, we provide financial resources – the income we receive, but we forget to think about credit insurance, and it is very important.
We sign an individual repayment schedule, which specifies the repayment method, the maturity date and the amount of the repayment installment.
Despite our goodwill, sometimes unfavorable and undesirable events occur, a bad coincidence of circumstances, and we are prevented from paying fairly and loyally by circumstances beyond our control. These are some of the most serious reasons for us to take out credit insurance to secure us when paying out the loans.
Credit insurance is a form of managing the risk of suspension of loan payments, it transfers this risk from the borrower to the insurer against a specified pay. Insurance companies raise funds from borrowers and undertake to cover the risks they incur.
Upon the occurrence of insurance events during the term of the loan, the insurers pay amounts at a predetermined amount of the creditor. Credit insurances are different, their nature, purpose and type depend on the type and nature of the credit we have withdrawn.
Credit insurance is compulsory or voluntary, it can be concluded at a chosen insurer or at the designated financial institution. Meet the details and check the risks covered by the insurance, some insurers offer different packages with complex coatings. It is extremely important the cost of the insurance – the insurance premium, it can cost the loan we have withdrawn.
When borrowed by the borrower, the insurance enters the annual percentage rate of the credit. The cost of the insurance is directly related to the amount of the payment on the loan, which upon the occurrence of the risk, the insurer will pay the creditor. In practice, credit insurance is usually paid along with the repayment installment on loans.
There are also occasional payments, depending on the type of credit and the policy of creditor financial institutions. Credit insurance protects us, our family, our home and property. The most common insurances are related to our life, health and employability. They are typical of consumer loans , they are concluded for the term of the loan and cover the risks:
- Loss of life as a result of illness or accident.
- Permanently reduced or lost working capacity caused by a serious illness or accident.
- Temporary disability.
- Long hospital stay.
- Unemployment Unwanted.
- Unforeseen events related to loss of income.
We know that mortgage loans require collateral from real or movable property. We protect him at the most common risks:
- Fire, lightning or explosion (including malicious).
- Storm, flood, hail, torrential rains, fallen trees.
- Sinking or collapsing of earth masses.
- Cleaning of rubble, remains due to natural phenomena.
- Damage resulting from accidents to: water mains, heating installations, sewers.
- Theft, vandalism and others.
Credit insurance is now available in various options, for example: life insurance of a saving nature, it combines the possibility of saving and security to be protected, additional Critical Disease Insurance upon the occurrence of listed 15 severe life-threatening events and conditions, Family Protection “- financial support for unforeseen incidents for two adults and two children and others.
The conclusion of bundled insurance programs offered by most banks is related to obtaining discounts, bonuses, preferences. Credit insurance is made in writing, forms in a special and specific insurance contract. The most important of its contents are: insurance events, insurance amount and premium.
Pay attention to the clauses in the contract, sign up after detailed information to ensure your peace of mind, security and credit insurance to guarantee repayment stability.