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What is payment protection?

I read about it, but still unsure?

If I borrow 5k and pay back in 1 year from Abbey at 7.9% APR, its £479.66 interest I think with payment protection and £434.08 without, whats the differences?

Thanks

Comments

  • catz747
    catz747 Posts: 20,381 Forumite
    Part of the Furniture 10,000 Posts Combo Breaker
    Payment protection is 'like' an insurance for situations where you are unable to keep up payments, for example through illness or what have you.
  • Usually cover in the event of accident, sickness, unemployment, life cover and critical illness cover - ie sometimes pays out for 12 months, or clears loan for the more serious scenarios
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