Loading the player...

What is 'Credit Life Insurance'

Credit life insurance is a life insurance policy designed to pay off a borrower's debt if that borrower dies. The face value of a credit life insurance policy decreases proportionately with an outstanding loan amount as the loan is paid off over time until both reach zero value.

BREAKING DOWN 'Credit Life Insurance'

Credit life insurance can protect a person's dependents. It may also be required by some lenders; therefore, it is important to read the fine print of any loan agreement to determine whether credit life insurance is required.

RELATED TERMS
  1. Decreasing Term Insurance

    A type of annual renewable term life insurance that provides ...
  2. Permanent Life Insurance

    An umbrella term for life insurance plans that do not expire ...
  3. Variable Universal Life Insurance ...

    A form of cash-value life insurance that offers both a death ...
  4. Annual Renewable Term (ART) Insurance

    A form of term life insurance that offers a guarantee of future ...
  5. Life Expectancy

    Life expectancy in social science is the statistical age until ...
  6. United States Government Life Insurance ...

    A life insurance program established in 1919 to provide term, ...
Related Articles
  1. Financial Advisor

    Which Life Insurance is Right For You?

    Consumers have choices when it comes to life insurance. Knowing your future needs for cash or retirement can make the difference in what you select.
  2. Insurance

    How to Pick the Right Life Insurance Plan

    Finding the right life insurance policy - if you need one at all - can be more challenging than it seems. Use this guide to find the right one for you.
  3. Financial Advisor

    Life Insurance for a Newborn Baby

    In most cases, this is unnecessary, though a small policy offers benefits in certain cases.
  4. Insurance

    Getting Your (Insurance) House in Order

    From starting a family to retirement, insurance can play a role in taking care of financial needs. This piece looks at some of the choices you can make.
  5. Insurance

    What Is the Best Age to Get Life Insurance?

    Learn about the optimal time for purchasing personal life insurance and why delaying the buying decision may have costly consequences.
  6. Insurance

    What's Better: Whole Life or Term Insurance?

    Life insurance can be a difficult decision to make, especially for a young adult. Here's a look at the benefits and costs of getting whole life insurance.
  7. Financial Advisor

    Permanent Life Policies: Whole vs. Universal

    If you're looking for life-long security, choosing between these two is the key.
  8. Insurance

    Millennials Guide: Too Young for Life Insurance?

    Unless you have kids, it's easy to think you don't need life insurance Here are the reasons why you might– as well as which type and how much to get.
  9. Insurance

    Should You Buy Term or Permanent Life Insurance?

    When choosing between term or permanent life insurance you'll need to consider these factors.
Hot Definitions
  1. Trustee

    A person or firm that holds or administers property or assets for the benefit of a third party. A trustee may be appointed ...
  2. Gross Domestic Product - GDP

    GDP is the monetary value of all the finished goods and services produced within a country's borders in a specific time period, ...
  3. Debt/Equity Ratio

    The D/E ratio indicates how much debt a company is using to finance its assets relative to the value of shareholders’ equity.
  4. Exchange-Traded Fund (ETF)

    A security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange.
  5. Net Present Value - NPV

    Net Present Value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows ...
  6. Return On Equity - ROE

    The amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation's profitability ...
Trading Center