Payment Protection Cover For Your Credit Card

Payment protection cover states quite clearly what it is but what are the ins and outs of the policy and is it worth considering taking out payment protection cover on your credit card.

You can have payment protection cover for most financial obligations and is insurance against not being able to meet your agreed payment requirements. When you are agreeing the terms of your credit card agreement you will be asked if you want to consider taking out this policy. You do not have to take out this cover; it is voluntary. The general cost of your policy depends on how much credit you have accumulated. The cost will most probably be calculated at a fixed price per one hundred pounds you spend on your credit card.

Payment protection cover will meet the minimum payment required and will start to kick in in the event of you falling ill, an accident, involuntary unemployment or death. Not all illnesses are likely to be covered by this insurance policy or you may find it to be much of a grey area, for instance, backache, stress related illnesses and mental illnesses such as depression all come under this category of the payment protection cover maybe deciding not to pay out.

In the event of illness or accident normally you would have to be off work for a certain period of time before the payment protection starts. This also applies to involuntary unemployment and is usually around 30 days, although, some policies may vary.

In the event of death the policy should pay the outstanding balance. There will be a maximum amount that will be paid out so you should check your individual policy to find out how much the maximum amount is. You should also check the policy regarding the death of an additional cardholder.

It is advisable to check your policy for how many days you have registered for in the event of sickness and death as some policies will not pay out if you fall ill or die within around 90 days of starting your policy.

You should always read through your individual policy before making any decision whether you want to take out payment protection cover on your credit card as you may decide that you don’t need it. On the other hand, no one knows if or when they are going to fall ill or find themselves redundant.