CREDIT LIFE ASSURANCE PLAN
Credit Life Plan is designed to protect financial institutions/organizations against the risk of death of short term borrowers. The plan is also suitable for co-operative societies, associations, clubs, employers and customers that grants loans to people.
Apart from protecting the financial interest of creditors, the Plan further serves the purpose of protecting policyholder’s dependants against the financial consequences of outstanding loans standing against their bread winner.
In the event of death, the creditor recoups its loan from the insurance proceeds under the plan and avoids the embarrassing situation of asset repossession or forced sale. Thus, the dependant keeps the asset in the family thereby reducing the agony of the policyholder’s untimely death.
Cover can be arranged for a maximum of 5 years.
If the next birthday of a proposer is above 55 years the proposer would need to go for medical screening.
The benefit payable will be the outstanding loan as at the date of death
Premium is expected to be paid as a lump sum
Policy does not cover default in loan repayment.
- A cheap way of acquiring assets
- Gives the stakeholders peace of mind
- Reduces credit exposure due to death
- Cover can be extended to include permanent disability or critical illness