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Should I get insurance to cover my debts if I am unable to pay them? Does getting myself insured make sense in Switzerland or is it a waste of money?
Hi there,
Getting payment protection insurance for personal loans and other forms of consumer credit is rarely worth it because premiums for this insurance are usually high. Lenders often recommend this insurance because it provides them with a secondary source of revenue.
When you take out payment protection insurance, you pay regular premiums in addition to your loan repayments. This greatly increases the total cost of loans.
Another thing to consider is that payment protection insurance only covers specific hazards such as loss of income due to illness or death. If you are unable to pay for any other reason, the insurance will not help you.
Only take out payment preotection insurance if you have want to be insured against a specific hazard, the premiums are low enough that the cost is negligible.
Best regards from Moneyguru
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