Consumer credit insurance is an option to safeguard you if loan repayments cannot be made because of sickness, accident or unemployment. Carefully consider the costs of the insurance to determine if the benefits are worth the outlay. Also, study the terms and conditions for any restrictions or limitations, such as a three-month limit on coverage. Under the Consumer Credit Code it is against the law for a lender to require you to take out this type of insurance.
Mortgage insurance
Mortgage insurance or mortgage guarantee insurance usually applies if you are borrowing more than 80% of the purchase price. This is usually in the form of a one-off premium paid at the time of settlement. Mortgage insurance does not protect your interest. It protects the lender in the event that you default on the loan and the amount still owed is greater than what is received from the sale of the property. It is important to note that if you default and the mortgage insurance is paid out, the insurance company will pursue you to repay the debt. Under the Consumer Credit Code a lender can require you to take out this insurance.
Insulation & Home Insurance
When you apply for, or change or renew an insurance policy, you have a legal duty of disclosure, which means that you need to disclose anything that may influence the insurer's decision to insure you.
For example you need to disclose anything that might:-
- increase the risk to be undertaken by the insurer; or
- not be evident to the insurer, but may influence the insurance policy.
If this duty of disclosure has not been fulfilled, and/or you have acted fraudulently, then the insurer may reduce or refuse to pay a claim or even cancel the insurance policy.
Anyone concerned about the safety of insulation installed in their home may wish to contact their insurer to discuss their duty of disclosure.
Related information
Copyright
Information on copyright for the Office of Consumer and Business Affairs website is provided on behalf of South Australia Central http://www.sacentral.sa.gov.au/site/page.cfm?u=60
Disclaimer
Information on the disclaimer for the Office of Consumer and Business Affairs website is provided on behalf of South Australia Central http://www.sacentral.sa.gov.au/site/page.cfm?u=61
Privacy
The South Australian Office of Consumer and Business Affairs (OCBA) is committed to protecting your privacy and the confidentiality of your personal information, consistent with the South Australian Government's Information Privacy Principles. If you would like to view the full privacy statement please visit: http://www.ocba.sa.gov.au/privacy.html
Webmaster
If you wish to provide feedback on the Office of Consumer and Business Affairs website please contact the Webmaster via email mailto:webmaster@agd.sa.gov.au
Accessibility
Information on accessibility for the Office of Consumer and Business Affairs website can be viewed at: http://www.ocba.sa.gov.au/accessibility.html
Information on copyright for the Office of Consumer and Business Affairs website is provided on behalf of South Australia Central http://www.sacentral.sa.gov.au/site/page.cfm?u=60
Disclaimer
Information on the disclaimer for the Office of Consumer and Business Affairs website is provided on behalf of South Australia Central http://www.sacentral.sa.gov.au/site/page.cfm?u=61
Privacy
The South Australian Office of Consumer and Business Affairs (OCBA) is committed to protecting your privacy and the confidentiality of your personal information, consistent with the South Australian Government's Information Privacy Principles. If you would like to view the full privacy statement please visit: http://www.ocba.sa.gov.au/privacy.html
Webmaster
If you wish to provide feedback on the Office of Consumer and Business Affairs website please contact the Webmaster via email mailto:webmaster@agd.sa.gov.au
Accessibility
Information on accessibility for the Office of Consumer and Business Affairs website can be viewed at: http://www.ocba.sa.gov.au/accessibility.html
