There seems to be so many different types of insurance policies these days. With a small monthly payment we can insure literally anything. It seems daunting and silly at times how much and what we can now insure. However, there are certain types of insurance that do deserve a second look. Once such insurance type is Unemployment insurance or what is more commonly known as income protection.
Polices vary, but the general purpose for unemployment insurance is to protect you should you be made unemployed. There are short policies that will cover you until you find other employment and there are longer policies that protect you should you become too ill or injured to work.
There are also several types of unemployment insurance. Some policy holders purchase theirs to cover their mortgage but there are other polices you can purchase to include other obligations. If you take out unemployment insurance to cover credit cards and loans then this is known as credit insurance.
There are two distinct advantages to credit insurance. If you loose your job and have large amounts of money in the form of loans and credit then credit insurance could help make your life much easier. Credit insurance also helps those who are self employed or work for companies that don’t provide adequate sick pay benefits. Generally you are paid a monthly sum for a period of time.
There are a couple of disadvantages to credit insurance. The first is, it can be quite expensive. The premiums are generally higher than other unemployment insurance policies. The other disadvantage is that it can only be used for specific debts. Unlike many types of unemployment insurance, where the funds can go where you see fit, these can only go to the debts that are listed on your policy.
Before purchasing a credit insurance policy, think if you really need it. If you are unlikely to be unemployed for long then it may be best to speak directly to your credit and loan companies. They may also have their own insurance available that would work out to be cheaper. If you’re likely to be out of work for a while, or are self employed then Unemployment insurance for Credit and loans could be a good option for you.