Credit life: your right to choose your own insurer (NCA s106(4))

What credit life insurance is

Credit life insurance pays your loan, card or account if you die, become disabled or are retrenched. Lenders sell it with the credit, but section 106(4) of the National Credit Act gives you the right to use your own policy instead, and the lender must accept it if it meets the rules. Switching can lower the monthly cost.

Who it suits

Credit life suits anyone with a home loan, vehicle finance, a personal loan or store accounts who is paying the lender's insurance on top of the instalment. Most people do not know what they pay or that they can substitute it. The credit life regulations cap the monthly cost per R1 000 owed, and an insurer who specialises in this cover may quote below the lender's price. Retrenchment cover needs proof of formal employment, so tell us how you work.

What it covers

Death, permanent and temporary disability, and, for most credit, retrenchment for a limited number of months.

Can the bank refuse your own policy?

Not if the policy meets the minimum cover in the regulations and you follow the lender's process for substitution. The insurer who calls you will supply the documents the lender needs.

Is this a loan?

No. Olvian does not offer or advertise credit. This is insurance on credit you already have or are about to take.

Draft for review. Sentences are drawn from the published Olvian copy; expand before launch.