Loan payment protection insurance
Explaining loan payment protection
There is no need for consumers to continue to be the victims of the High Street “protection racket”, thanks to the launch of an ultra-competitive new loan payment protection insurance product by securityfirst.co.uk.
For years major lenders have not only raked in profits from charging those wishing to borrow money steep rates of interest, but they have also enjoyed an additional cut by selling the same customers loan payment protection insurance policies at rip-off prices.
Loan payment protection insurance, which covers the cost of loan repayments if policyholders are unable to work as a result of suffering illness, injury or involuntary unemployment, certainly has a valuable role to play if it is available at a reasonable price.
After all, there can be few borrowers who are not vulnerable to the possibility of losing their income as a result of a health setback or redundancy.
Anyone who expects the State to bail them out is likely to be bitterly disappointed. It may provide benefits sufficient to prevent you from actually starving, but there is most unlikely to be anything left over to put towards loan repayments.
But many lenders charge well over £4 a month per £100 of monthly cover for loan payment protection insurance. Borrowers, who are by definition already financially stretched, could do without being victims of such blatant profiteering.
Contrary to popular belief, there is no requirement to take out your loan payment protection insurance with the same organisation that is granting you your loan, and most people need now look no further than securtyfirst.co.uk to obtain the best value cover in the marketplace.
This is because securityfirst.co.uk has launched a novel age-related product with prices that simply cannot be beaten for younger policyholders.
With standard loan payment protection insurance, all policyholders pay the same flat rate, with premiums varying only according to the level of cover required. This means that older policyholders, who are more likely to go ill and less likely to find a job quickly when laid-off, are effectively being cross-subsidised by younger ones.
But securityfirst.co.uk takes your age into account when calculating premiums. Those aged between 18 and 25 have to pay as little as £1.75 a month per £100 of monthly cover. Even those aged between 46 and 50 only have to pay £3.50 a month per £100 of monthly cover.
Like all loan payment protection insurance, the age-related cover still has some significant exclusion.
For example, the involuntary unemployment component does not cover voluntary redundancy and only covers self-employed people if they permanently cease trading.
Medical conditions that existed prior to the start of the loan payment protection insurance policy are also not covered, although this exclusion is waived in cases where you have not suffered from the relevant condition for two years before the time at which you become unable to work.
Nevertheless, the new age-related approach is so competitive for the younger age-groups that it can still be considered good value by many people who are affected by these and other exclusions.
