Credit Life and Disability on Auto Loans

 
There are things that are important in this life to take out insurance on. You should have health insurance, car insurance and life insurance – these are the three biggies. But when it comes to taking out an auto loan, how do you know if credit life insurance or disability insurance is worth taking out on the car? You know that it is going to cost you more money in the long run if you have it and you also know that it is a gamble. You hope that you don’t ever need it, but think that maybe you should get it just in case.
 
There are some things you can usually bypass the insurance on. For example, when you go to Best Buy and they want you to take out the insurance on whatever it is you are buying, or when you go to mail something and they want to know if you want to pay more for insurance so that it gets there – this is normally a waste of money. But when it comes to something like an auto loan, you might want to think twice before you decline the offer.
 
If you have credit insurance or disability insurance and you are hurt so badly that you cannot work again, or you are killed, the car is paid off. You no longer have to worry about how you are going to pay back that auto loan when you are on disability and you don’t have to worry that a spouse will have to try and make the payments on their own. Let’s say you and your spouse are on a limited income and you pass away. Your spouse won’t have to worry about losing the car if they can’t make the payments as it will be paid in full for you.

Back to May 2010 Archives