Mansell, Engel & Cole

Debt cancellation coverage: a look at credit insurance

Insurance coverage is simultaneously one of the most complex yet simple business offerings. On the one hand, we all know that a policy is going to feature pages of fine-print legalese, coupled with riders, exclusions and other qualifying factors. Many of those ultimately catch policyholders in Oklahoma and elsewhere by surprise, resulting in unanticipated detriment. That is true regardless of the type of insurance involved.

Notwithstanding the “How could I have possibly foreseen that?” aspects often attaching to a policy, though, the essential idea and thrust of insurance is clear enough: Its purpose is to protect against loss and risk. Policyholders who duly pay their premiums and otherwise honor the terms of their insurance contracts have a reasonable expectation that their insurer will step up and perform when a claim for payment or performance is presented.

That is true across the broad universe of insurance forms. At Mansell, Engel & Cole, for example, our deep pro-policyholder legal team handles disputes and denied claims covering insurances ranging from health, life/disability and long-term care to commercial liability, vehicle accidents, home-linked risks and more.

Today we note credit insurance, which is yet another focus of our firm. That type of coverage is perhaps not as widely known to many people, given that fewer individuals seek credit protection than they do safeguards against something like a car crash or cancer diagnosis.

The crux of credit insurance is that it provides protection for a policyholder against creditors if customary payments on something like a loan or credit card can’t be paid. A policy-noted event such as a disability or job loss triggers an insurer’s duty to pay.

They don’t always do that, of course. We will have more to say about credit insurance in our next blog post.

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