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Why you need insurance on your loan

 

These precautions have become second nature because they’re simple and make sense. They protect our loved ones and ourselves, so we make them a habit. The future is unpredictable, so we take steps against unexpected dangers.

The same logic applies to your financial future. You need insurance on personal loans, for instance, in case your circumstances change suddenly.

That’s why every personal loan comes prepackaged with an insurance element. This may be called credit life protection or credit life insurance, and is in place only for the duration of your loan.

For a small monthly fee, often less than R5 per R1,000 borrowed, the insurance protection will cover the amount remaining on your loan. If you pass away, the insurance will cover your outstanding loan amount.

If you are permanently employed, you will also enjoy cover for comprehensive disability and loss of income. The disability benefit will cover your monthly instalments if you cannot earn your usual income due to illness or bodily injury.

The loss of income benefit includes retrenchment and events where you remain employed but are unable to earn an income. This benefit will cover your monthly instalments for up to 12 months.

Since the cost of your premium is built into your monthly instalment, securing your ability to cover your personal loan is as easy as fastening your seatbelt or locking your door at night. 

For more details, see our personal loan credit protection plan