Adam McCann, Financial Writer
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Loan insurance is a policy that protects you if you are unable to make loan payments for a certain amount of time due to circumstances out of your control, like medical issues or unemployment. There are different types of loan insurance. One type will make loan payments for you up to a certain amount of money during your time of hardship. Another will pay off loans in the event of your death. And another will protect your collateral if you have a secured loan.
Loan insurance can provide some peace of mind and help you avoid credit score damage from late payments. But it's important to weigh the costs against the benefits, and read the fine print, before purchasing this insurance.
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