What is credit life insurance?

Q: What is credit life insurance?

Credit Life Insurance is a voluntary insurance product that helps pay off an eligible borrower's remaining loan balance if the insured borrower dies during the loan term. Benefits are generally paid directly to the lender, subject to the policy's terms, conditions, limitations, and exclusions.

Credit Life Insurance

Insurance

Credit Life Insurance is a voluntary insurance product that helps pay off an eligible borrower's remaining loan balance if the insured borrower dies during the loan term. Benefits are generally paid directly to the lender, subject to the policy's terms, conditions, limitations, and exclusions.

Credit Life Insurance is commonly offered by banks, credit unions, and other financial institutions alongside consumer loans, such as auto loans, personal loans, and recreational vehicle financing.

Why it matters for financial institutions

Credit Life Insurance enables financial institutions to provide borrowers with an additional layer of financial security while strengthening their overall lending programs. The product helps protect surviving family members from assuming certain loan obligations, reduces the potential for loan losses following a covered death, and enhances the value of the lending relationship. For banks and credit unions, offering Credit Life Insurance can improve the customer experience, increase non-interest income through protection product programs, and reinforce their role as trusted financial partners committed to helping members and customers prepare for life's unexpected events.