Are personal loan cover and personal protection cover the same thing?
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I'd like protection for a personal loan, but does it make better financial sense just to buy income protection?
garethp
2 years ago
Expert Financial Adviser Answer
Darren Smith
answered 1 year ago
This is a very good question.
personal loan cover will only pay out enough to cover the loan and only until the loan is repaid (as long as you are still eligible to claim) it will sometimes cover for redundancy and death. These two features are not common in income protection plans.
However if you are more concerned about having income replaced due to accident or ill-health (perhaps you arent eligible for redundancy cover due to being self employed or not in a permanent job) then you will possibly find that you can buy more income protection cover this way and the benefit is that the income protection cover will run as long as you initially applied for (usually up to retirement) so again, as long as you are still eligible to claim it could pay out for much longer than loan cover as most personal loans stop at 8 year terms.....
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personal loan cover will only pay out enough to cover the loan and only until the loan is repaid (as long as you are still eligible to claim) it will sometimes cover for redundancy and death. These two features are not common in income protection plans.
However if you are more concerned about having income replaced due to accident or ill-health (perhaps you arent eligible for redundancy cover due to being self employed or not in a permanent job) then you will possibly find that you can buy more income protection cover this way and the benefit is that the income protection cover will run as long as you initially applied for (usually up to retirement) so again, as long as you are still eligible to claim it could pay out for much longer than loan cover as most personal loans stop at 8 year terms.....