If you never thought that you were sold PPI because the bank employee or financial adviser sold you a different insurance policy, beware that it could be wrongly sold as well. Payment protection insurance is not the actual financial product name, but rather a description of the item’s function for your financing. Here are three names it is commonly known.
Mortgage Protection Policy
Mortgages are paid yearly inclusive of interest, which makes it imperative that lenders require a protection plan in case the borrower gets sick or encounters a situation that they cannot provide payments. A mortgage protection policy helps provide a year’s worth of repayments, but only if the insurance holder is eligible.
Credit Card Payment Guarantee
Similar to mortgage protection policies, credit card payment guarantees and insurance repay a year’s worth of credit card repayments. Lenders will require this from high-risk borrowers, but they cannot ask them to purchase a specific brand because all financial products have different terms and conditions.
ASU Payment Plan
Accident, sickness, and unemployment payment plans (ASU) allow borrowers to pay one year of repayments for their financing. However, once again, banks and financial institutions cannot ask applicants to purchase a specific ASU brand because each policy’s provisions differ from one another.