If you've heard some of the news about the loan protection insurance industry recently, you might be wondering, "Do I need loan protection insurance, or is it just a big scam?"
There have been a lot of investigations into the payment protection industry because people have said they were mis-sold coverage and charged too much for premiums. Even though this is true, the big companies that sell the product are to blame, not the policies themselves. The main problem is with the lenders and banks on the high street. Even though they may be well-trained to sell loans and credit cards and get you a great deal on them, when it comes to selling protection for them, they often don't tell you much and try to force you to buy it without fully explaining it. Because of this, and because of greed, many people have found that they couldn't make a claim on a policy because of hidden exclusions in the policy.
Loan protection can be seen as a necessity if you think about how you would pay your monthly loan payments if you lost your job, got sick, or got in an accident and couldn't work. If you don't have the policy, you might not be able to pay your bills on time or even fall behind. But if you have the cover, after you've been out of work for a certain amount of time, the cover will give you money so you can keep paying your bills.
The answer to the question depends on where you want to get the cover. Yes, you could be ripped off by high street lenders and banks if you don't look into other options first. But it should be considered a necessity if you buy it the smart way by researching the market first and going with an independent seller.
