Insurance just seems to be one of those things that really don't cross your mind, until of course you need it! Who likes talking about insurance? Well...insurance brokers! Any time you apply online for a credit card you will get bombarded with offers to add credit insurance to your existing plan. These ‘protection plans' can be anything from health and medical to automatic bill pay and they exist in the sense of a few additional dollars on your monthly credit card bill. Good credit cards come with good insurance plans and many credit cards for people with bad credit even come with the plans.

There are many instances when the protection of a credit insurance plan will come in handy: You lose your job; you're injured and are unable to work; there is a death or disability to a financial provider in the family, etc. Whatever the case happens to be, if you search for the right credit cards you will come out with the right plan. A credit card search will yield this new type of insurance that most often time gets overlooked- the credit insurance!

If you are looking for the best possible way to minimize your threat of financial disaster in tough times then credit insurance will promise (through its optional programs) insurance if disability, unemployment or even death becomes relevant in your family. Many times these credit cards come with no annual fee and are often rewards credit cards, so you're getting extra bonuses for no charge!

Obviously, because credit insurance offers such a unique alternative to ‘regular' insurance policies, many people have turned to them. In fact, over 200 million Americans are actively involved in some good credit card program in some way!

Narrowing down your credit insurance choices!

There are several types of credit card insurance, so the first task at hand is deciding which one fits your ideal lifestyle and budget the best. There are credit life, unemployment, disability and property insurance. Here is a closer look!

• Credit life: Credit life will pay off any and all of the debt that is in your name after you die. This covers all of your unsecured debts (credit cards, loans, etc).
• Credit unemployment: Credit unemployment will help cover you if you are unemployed due to involuntary circumstances. Under this plan you will have the minimum balances paid each month on your credit card. This is designed to keep you on track financially and to not let you fall back.
• Credit disability: Credit disability is a credit rating protection that acts in a similar fashion as credit unemployment (by paying your minimum payments), but instead of covering you if you are laid off, it will cover you if you become medically disabled/ unable to work because of a job related activity.
• Property insurance: Credit property insurance will cancel any debt you have on purchases that you purchase that you receive damaged and unusable. This is a very useful insurance to have if you do a lot of business over the internet (especially EBay!).

Learning is the first step to doing... especially with insurance.

So, how does credit protection work? No, you don't necessarily need a credit card for those with excellent credit (although it certainly won't hurt!) and you can still cash in on a good plan if you have a bad credit history.

This is how credit insurance works: You sign up for the program, usually off of the sheet that your credit card company provides you and you wait for them to accept you into their program (usually takes 1-2 billing statements). Next, if any of the above circumstances unfortunately comes your way, you can expect your minimum balances to be paid off (unemployment, disability) or even your entire unsecured credit card debt wiped out (unexpected death).

However great a credit insurance policy can be, there are still a few regulations when you apply for a credit card. For instance, you can't try to claim injury or sickness before your policy begins, you can't use pregnancy, childbirth or cosmetic surgery as a medical condition and you can't have a disability case due to drug abuse or intentional injury!

Okay, credit insurance looks okay- how can it help me?

If you want to sleep better at night understanding that you and your family are protected from any financial burdens that may come up in job related instances, you will want to take a hard, close look at credit insurance. While many bad credit cards don't have these programs, if you search for credit cards hard enough, you will find the right one for you. Here are some questions you should ask yourself before partaking in a program:

1. Who will make your payments if you become disabled?

2. Will your monthly payments be made if you suffer a critical injury?

3. If you are looking for a new job, who will cover your unemployment finances?

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Comments

William, 03:48 AM, August 31, 2007
Credit insurance is a good thing. It helped me greatly when I was in hospital after a car incident.

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