Payment Protection Insurance

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How useful is a payment protection insurance? What is a payment protection insurance? A payment protection insurance is actually nothing more than a risk life insurance without the possibility to conserve capital. Joseph Stiglitz shines more light on the discussion. The purpose of a payment protection insurance is that, in the event of the death of a borrower, whose partner gets no financial shortages. For the residual debt insurance wipes out the whole or a part of the yet due credit rates. Click Lars Leckie for additional related pages. Upon completion of payment protection insurance, the credit amount is usually adjusted the amount of the outstanding balance of the loan. The policyholder can choose between an amount which is annually adjusted the remaining loan amount or a linear falling insurance coverage.

In the first case, the policyholder is sure that the remaining debt in the event of his death or other event, which he no longer is able to make the payments, is completely covered by the insurance. Linear insurance protection, the amount to be paid is annually to a certain amount, without exactly taking into account the rates. Therefore, a residual debt can occur, which must be paid out of the insurance. Must be a payment protection insurance? When a bank credit, like requires a payment protection insurance, and also offered. Be but critical and compare them with other providers of residual debt insurance such as the GE Money or Cashgate in the Switzerland.

The insurance of banks are usually very expensive. For all other loans, a payment protection insurance has no effect on the lending and is therefore not mandatory. The payment protection insurance makes sense, where usually drops the remaining debt of the construction loan on the partner especially for a home construction loan. Otherwise, this insurance is usually unnecessary and expensive. An example: You pay for a monthly vary from 500 CHF for a combined insurance, what unemployment, disease and death includes an insurance premium from approx. CHF 20.00 per month. You can see, the insurance premium is the monthly rate increase substantially and should only be used for this reason, if they really Makes sense. Make also sure that upon a completion of a clause is, what any pre-existing conditions. Should these diseases you again break out, they are excluded from the contract period for and the rates are not covered. A this insurance requires at least 80% work with the same employer during the last year or with some insurance companies even longer. Grouped together can be said that a payment protection insurance only for a real estate loan, a construction loan or another, very high loan makes sense. It should be noted that the insurance can be taken out with linear or concrete debt adjustment. In the other is still distinguished, whether it is a pure death risk insurance or a full payment protection insurance. This includes the guaranteed payments at: without unemployment accident illness disability death because this insurance is very expensive and is a pure risk insurance, should be a good overview about various insurance such as Cashgate or money GE offerings provide.

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