Posts Tagged 'credit life'

Why credit life/disability is good for everyone

With the Great Recession, there has been a wave of financial industry regulations affecting everyone from small banks to giant investment firms – and credit unions like American 1. The Credit CARD Act, the opt-in regulations on overdraft protection, and now a scary-looking form that wants to scare you from opting out of credit life insurance on your loans.

Credit life works like this: if you die, your loan gets paid off. That’s it. Your family doesn’t have to come up with the payments. Nothing gets taken to court. It saves a giant hassle on your family’s end – and on our, the lender’s, end since we’re still getting paid. Win-win, right?

Credit disability works in a similar way, except if you get sick or injured, your loan payments are made while you’re off work. Accidents happen all the time, and so does sickness. None of it is expected. Disability coverage helps protect you from the unexpected.

We’ve gathered up our members’ best stories on insurance products and sharing them with the review board before this thing becomes law. We’re also urging them to reconsider this law because of its unintended consequences. You can read it for yourself.

The fact is, credit disability has helped a ton of American 1 members. They have peace of mind knowing that, if the worst happens, they don’t have to worry about their loan.

Here’s the thing: no member or member’s family who benefitted from credit life or disability protection ever regretted their decision. It’s not like a family member dies, the loan gets paid off, and the survivors think, “Gosh, why did Uncle Joe get that silly insurance?”

Or a member gets sick and says, “Man, why did I opt to have my loan paid for during this difficult time?” That doesn’t happen. Not ever.

No, these products equal peace of mind. It’s best to have fewer things to worry about when a loved one dies, gets injured, or becomes ill. And no one likes to think about it, but we’re all responsible adults here. Family members die. Family members get sick and have to take time off work. What counts is that we’re ready when the unfortunate time comes.

There’s no sense in scaring your away from valuable protection like credit life and disability. And for us, it helps all our members because we’re not trying to collect on past-due debts. Products like credit life and disability help to keep costs and rates down.

Credit life takes care of payments

When Ralph Fiebig’s wife Mary retired, the couple decided that taking a bigger pension payment instead of more benefits seemed the right thing to do. After all, any bit of extra income helps.

But when Mary passed away last year, so did her pension income. That left Ralph with a mortgage, car payment, and Visa payment. Luckily, The Fiebigs decided to opt for credit life on both their auto loan and Visa card with American 1 Federal Credit Union.

“Everything was taken care of,” Ralph says. “I didn’t have to worry about my car payment or my Visa payment anymore.”

Because Ralph and his wife put credit life insurance on both loans, a total of $11,000 was paid off in full after Mary died. Now, with Ralph facing more medical costs and less income, paying off his auto loan and Visa balance leaves him with two less things to worry about.

He says credit life isn’t that expensive, and pays for itself when the unexpected happens.

“And I was surprised and how smooth it all went,” Ralph says. “It wasn’t a bunch of haggling and phone calls. I just went to the branch and they took care of everything for me.”

Ralph now has his own American 1 Visa, and he chose credit life on that card, too, so his children won’t be burdened when he dies.

American 1 Federal Credit Union