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What is Credit Life Insurance?


Whether it’s a personal loan, a revolving loan, a credit card or a student loan, you are likely paying for credit life insurance as part of your debt repayment.

Credit life insurance is insurance that provides security should you be unable to repay your debt due to retrenchment, disability or death. The credit life insurance policy will pay the debt either in part or in full to the bank. It protects both you and your loved ones from the strain of having to service debt when life happens.
Do you know how much you’re paying for credit life insurance?Most consumers with existing debt don’t realise they have credit life insurance, what it is and what it costs. Find out more here.How much are you paying?Most consumers with existing debt don’t realise that they have credit life insurance, what the benefits are and, how much it costs. You can now also select a credit life insurance policy with a provider who is not your credit provider.

Credit Life Insurance regulations protect consumers. The maximum premium that can be charged by credit providers per month is capped at R4,50 per R1000 borrowed. For example, if you have borrowed R60 000, the maximum credit life insurance that you should be charged is R270 (R4.50 x 60) per month. The regulations also ensure that all providers have standard benefits and exclusions of credit life cover, meaning regardless of the provider you choose you will at the very least be covered for death, disability and retrenchment. In essence the law protects you from being overcharged and most importantly you can now shop around for a policy that meets all your needs.

Cut costs by taking a good look at your current loan agreements and ensuring you are paying the best possible rate for your credit life insurance.

Do you know how much you’re paying for credit life insurance?You have the right to choose Many consumers are horrified to find they are paying up to R15 or more for every R1000 they owe.

You have the right to switch to a policy that offers a better rate. You should not be overpaying for credit life insurance.

Like most South Africans, you will probably have a need for a personal loan at some stage of your life, but that does not mean you have to settle for credit life insurance policy the provider offers you. You have the freedom to shop around.

You have the right to choose
Switching to Yalu could help you saveThe Yalu Credit Life Insurance Plan brings you one policy to cover all your unsecured credit facilities. One premium, and one provider to deal with if you should ever need to claim.

Switching is easy, convenient and quick (five minutes or less). What's more, Yalu handles the admin of cancelling the existing policy. Here's how much you could save on a personal loan of R60 000, with a repayment period of three years, if you switch to Yalu.

    • Total credit life paid at R3.50 per 1000 over three years: R210/pm x 36 = R7 560
    • Total credit life paid at pre-Aug 2017 rate of R8.50 per R1000 over three years: R510/pm x 36 = R18 360
    • Difference: R10 800 over 36 months or R300 per month

Ts & Cs apply. Yalu Financial Services is an authorised Financial Services Provider - FSP 48495. Underwritten by Old Mutual Alternative Risk Transfer Limited (OMART), a registered Long-Term Insurer.

Switching to Yalu could help you save