Credit Life Insurance

Credit life insurance refers to a group life insurance contract in which a creditor is protected incase of the death of the indebted person who is insured. Incase if he dies before making the full payment, the credit provider is guaranteed the payment of full debts. This type of insurance is usually bought by mortgagors.

In this the amount of the policy matches the loan balance at any given time. It is designed in such a way so that the loan will be paid of completely on the event of the death of the insured. There are several types of credit life insurances. They are xSingle life insurance , joint life insurance and xlevel term life insurance .

The xsingle life insurance covers the life of a single debtor in the transaction. Incase if the single debtor is taken out on a transaction that is signed by both spouses either the husband or the wife is the insured. The xjoint life insurance covers the life of two debtors which is usually the husband and the wife.There is also another kind of life insurance called xlevel term life insurance which is placed on single pay credit transactions.

More Glossary Terms Explained here