There are two different types of coverages that fall under Credit Insurance. These coverages consist of Credit Life Insurance and Credit Disability Insurance. Each coverage type has its own features and exclusions that must be met in order for a borrower to apply, and be eligible.
Disability Insurance is a coverage that is highly overlooked and should have more of a focus put on it at time of loan closing. As a financial institution, your main collateral for a loan is the ability for a borrower to pay it back. If a borrower becomes disabled, or too sick to generate income to repay a loan, your collateral is lost. It is important that each and every borrower is made aware of their responsibilities to repay a loan and that they prepare for the unexpected.