The operating principle of credit insurance

The credits insurance are in place to ensure the borrower and the banking institutions of the execution of reimbursement of due dates of loan in case of occurrence of a serious event. Events covered by insurance are numerous. However, the most common are the death of the borrower or co-borrower, temporary incapacity or total work disability or job loss.

 

The cost of credit insurance

Credit insurance will be solved in the form of a monthly fee which depends on several parameters chosen at the time of taking out insurance. This cost will be taken into account when comparing two loan offers, because it represents the amount high enough to global. For example, for a loan of $230,000, the monthly insurance paid by two co-borrowers will be $100 per month over 25 years.

 

 

The percentage provided

The cost of insurance depends mainly of the proportion insured. In fact, insurance companies offer the borrower to determine a percentage of insured in case of occurrence of the event. Thus, it is possible to take out insurance to 75%, which means that the insurance will cover 75% of the monthly payment if the event occurs. This allocation of risk is to conscientiously study the framework where you take two since it will have to choose a percentage for each of the borrowers.

 

The guarantees

Finally, we must also consider all the guarantees offered by insurance companies. These guarantees will vary according to the airline, including exclusion criteria and modalities of care. The cost of insurance will be put into perspective the guarantees offered. Do not hesitate to tour the banks and foreign insurance companies to obtain several specifications and perform a comparison of full insurance.