Loans and cover (UC, sickness, etc)

Fudge_2

Good evening all from a new member of the forums.

It may have been asked before but I couldn't find it in search, but here's my query...

I am currently paying £x per month for my car finance deal which was taken out in October last year over 4 years. Last week I got an early settlement figure which I was greatly shocked at being so low given the original price of the car, and here is where the query lies...

I'm looking at taking out a loan for the settlement amount but not greatly impressed at the charge for cover (unemployment, sickness etc), as this take me back to almost the same as what I am paying just now to the car finance company.

What can be done so that I can take a loan with no cover but take out a policy with an insurance company or like for unemployment and sickness cover as I had a quote for one a while back at around £10 per month for over 5years

Is this advisable?

So to sum up,

Take out a loan for 15k amount with no cover, and take out a term assurance with another company? Advisable? Yes/No? If yes, what's the best course of action to take??

Thanks in advance

Rafter

Fudge,

You are definately better off not taking out payment protection which can often double the cost of your loan.

If you are worried about sickness or unemployment then you can buy a much better value policy direct from a broker. Have a look at prices on insurancesupermarket.com for example.

However, all these policies have lots of exclusions and only pay out for a short period. If you are in a good job and have skills that in demand then you have to ask yourself why you need insurance. This is also unsecured debt, so if the worst was to happen and you were unable to work through sickness or injury you can just stop paying your debt.

Sounds like you are on the right track.

R.