Thanks for coming back to visit our auto loans blog. Today’s post will help you understand what credit disability insurance is and how it can be useful in the context of your poor credit auto loan. We, at Valley Auto Loans, have been dedicated to offering expert opinion to help you gain control over your financial matters in this difficult economic scenario. Being a seasoned player in America’s finance market, we understand your concerns and have answers for all of them.
What is Credit Disability Insurance?
Credit life and credit disability insurance can be defined as one that provides coverage specifically for complete or partial payment of debt, if the working capability of the borrower is diminished by disability. Depending on the nature of disability, complete of partial coverage is available for credit disability insurance. It comes to effect when the borrower is disabled for 30 days or more due to sickness or disability and covers all monthly payments starting from the time since when the borrower is unable to work this can certainly justify the cost of car loan disability insurance. However, depending on your policy, this time for the benefits to start may vary between 14 and 90 days from the onset of your disability. Most importantly, there is no need for the insured person to be permanently disabled in order to benefit from his/her credit disability insurance.
Always remember that one is required to request for credit disability insurance prior to the signing of loan documents. The calculation of the monthly premium is done on the basis of the type of coverage and the amount financed. The monthly payment increases for disability insurance because the cost is added to the total amount financed. The necessity for this type of insurance coverage varies from person to person. However, it is advisable to think twice before availing credit disability insurance because it has very strong advantages and disadvantages.
So what are the benefits of credit disability insurance?
The biggest benefit is that it offers borrowers the much needed peace of mind by ensuring coverage of payments even if they are permanently or temporarily disabled. The payment for this insurance is a part of the car payment and hence, there is only one bill to pay. However, cost can be a serious constraint because credit disability insurance policies are generally more expensive compared to another policy for the same loan amount. Also, do not forget that you need to pay interest on every monthly premium because this is a part of your loan.
The credit disability insurance policies are same irrespective of your credit score. Carefully compare the costs and benefits if you feel that this insurance coverage can be useful for you. Also, keep visiting this blog for regular updates on the most commonly faced financial issues.
Valley Auto Loans can also be your ultimate online destination for hassle free auto loans, even with poor or no credit. We approve almost all our bad credit loan applications within just one minute.