Do you need credit life cover if you have life and disability cover?

There is no single answer to this question. A lot depends on your circumstances – in particular how much cover you have and how much debt you have.

To answer this question, you need to think about:

• Whether your lump sum disability cover is sufficient to pay off your debt should you be disabled or whether you have income protection that will pay you enough income to continue paying off your debt.
• Whether there will be enough money in your estate to pay off your debt should you die or whether you have enough lump sum life cover to pay off the debt.
• If you are single and you do not want to leave your home or other assets to an heir, these can be sold after your death to repay the debt.
• Whether the credit provider requires you to have credit life cover in place. You can cede an existing life policy to the provider.
• Whether you have income protection with retrenchment cover in place.

Credit life cover is largely sold with limited underwriting, while life and disability cover can be bought with full underwriting and this can affect the cost of the cover. Read more What does it mean if cover is fully or partially underwritten?

• What are the different terms of the policies you have when it comes to benefits, waiting periods, exclusions and premiums.

Some insurers are offering you the option to take out credit life cover that does not decrease in value as your debt is repaid, but allows you to nominate a beneficiary to receive an excess cover that is not required to repay your debt. Once your debt is repaid, the policy converts to personal cover that will remain in place for the rest of your life if you continue to pay premiums.