One of the myriads of insurance that is now available is called credit life insurance. Essentially what this insurance does is, much like life insurance, pays off your loans or credit lines if you happen to die. However, you might find that this is not as great of a deal as you would think.
The major problem with this insurance type is that it is simply too expensive when you compare it to the premiums that you would pay for term life insurance. Especially in cases where the amount is set, like a car loan. This is because the amount of coverage would constantly be decreasing. This is due to the fact that the insurance really only pays out to the bank, as opposed to going to you.
Let’s contrast this with life insurance, which pays out directly to you. Another problem is that there is typically no physical or quotes associated with this insurance. This means that you are only assessed for qualifications after you file. This could lead to you paying out for years, and not even receiving benefits! Not a great deal if you ask me.
For a great alternative, I suggest that you look into life insurance policies and if you have credit life insurance, I suggest you cancel it immediately.