Essentially, in the case that you find yourself unable to repay your loan you might make a claim on your risk insurance or loan protection. Reasons you may be unable to make repayments on your loan are illness, disability, or other unique circumstances. Risk insurance and loan protection can cover home loans, car loans, and personal loans.
Typically, your risk insurance or loan protection will cover payments up to a predetermined amount. In the case that you find yourself unable to make repayments, you’re able to initiate a claim on your risk insurance or loan protection, and then secure those monthly payments. These loans typically have a shorter term with coverage being offered on average, somewhere between 12 and 24 months. Your coverage may also include a death benefit.