First, credit life insurance is a type of insurance policy that banks will try to sell - and they will try hard to sell thanks to big commissions for these products - when a customer takes out a loan or opens a home equity loan. It's an add-on product, and some might even try to say that credit life insurance is required when you take out a mortgage with less than a 20 percent downpayment. Credit life insurance pays the lender if the borrower dies before having a chance to repay the loan in full.There are off-shoots to this type of insurance product. Credit disability insurance pays the lender if disability makes it difficult for the borrower to live up to the obligations of the debt, and you might find products like credit unemployment insurance.
Credit Life Insurance: You Don't Need It
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