Payment Protection Insurance
Your heirs will be free from any financial worries
Maybe you would prefer not to think about it, but what would happen if you (or your partner) bought a house in Belgium and you died before the end of your loan repayment, for example? Under these circumstances, the loan protection policy offers your heirs real financial protection by repaying all or part of the outstanding debt. This means they avoid additional unexpected charges.
You determine the level of cover for the amount of the loan
Do you want maximum protection? Then the loan will be reimbursed in full if you or your partner were to die. You can also choose to cover your loan according to the distribution of income within your family. Does your partner earn 75% of the household income? Insure 75% of your loan 'on his/her life', so that if he/she dies you only have 25% left to repay. Other breakdowns are also possible, in line with whatever you want. Are you refinancing your home loan? Then you can adjust the loan protection policy.
In one go
Taking out a loan protection policy with a single premium means you benefit from an advantageous premium. So you no longer have anything to worry about. You also benefit from a not inconsiderable tax break in the first year.
In several instalments
Do you prefer to pay regular premiums? This way you divide the premium into fixed amounts that you pay each year, over the first few years of your insurance. The longer the period you spread the premium over, the lower the premium each year.
By opting for what are called 'risk premiums' you pay an annual premium for the duration of your insurance. Does this spread the cost the most? The level of the premiums, which you will be told in advance, changes over the years. It is in fact linked to the risk of death (which increases with age), but also to the remaining balance, to interest rates and the term of the loan.
You are certain of repayment in the event of death
Before taking out the policy, you have to complete a medical questionnaire, tell us about your smoking habits and your medical history. Once you have taken out the loan protection policy, you are insured for repayment of your loan in the event of dying before it is repaid.
Insurance for disability
What would happen if you became disabled and were no longer able to work? It would severely disrupt your financial situation. A good reason to take out 'Disability protection' as an option. This optional cover provides for the payment of monthly income (maximum €1,000) over a period of up to three years. This buys you some time to find a way to get your finances in order.
Insure the balance of your home loan... and other loans too
You can also use the loan protection policy as 'floating' insurance covering the cost of a child at university, for example. This reduces the risk of insolvency in the event of your death (or that of your partner). If, for example, your son is embarking on a five-year course of study, and this costs €3,000 per year, then you can take out a policy for €15,000. Each year the insured capital is reduced by €3,000, as is the remaining risk. Once your son completes his studies, the risk has gone and the insurance ends.
This is an insurance product of AG Insurance, distributed by BNP Paribas Fortis.