Is payment protection on personal loans a complete waste of time?

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bb12

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I've several personal loans with payment protection on all of them. However, I've read so much bad press about how much a rip-off payment protection is, I'm just wondering if I should stop these payments on my loans? I always have a fear of being unemployed and unable to repay my loans which is why I got the protection in the first place, but should I really worry so much about this?
 
payment protection is a waste of time and money.

there is less likelyhood of getting into debt if you are taking on less debt to begin with so cut out the payment protection.

If you get in to trouble you can always sell the asset that you got the loan for.

Payment protection just pauses the repayments for you, it doesn't cover your repayments and you'll always end up paying what you owe.

If you are worried about being made unemployed then stop payment protection and start saving the money you would have paid on payment protection and keep it to one side in case of a rainy day. If the rainy day doesn't come then you have more money in your pocket once the loan is paid off.
 
I agree with Dipole. Read the terms & conditions of most payment protection agreements and you'll usually find that they will only pay out in restricted circumstances and for restricted periods of time which will usually make them bad value for money. I don't agree that it's a rip-off though (except where some lenders automatically select it on the loan application form which is a bit of a swizz) since the terms & conditions are available to the borrower to read before they buy such insurance if they deem it necessary and worth the premiums charged. If the borrower fails to make an informed decision then that's their own problem not the lender's.
 
That depends. Have you enough savings to survive a period of unemployment? Does the insurance actually cover you for unemployment?

Edit: I started writing this post around 2 hours ago so it has crossed with the others.
 
Dipole said:
If you get in to trouble you can always sell the asset that you got the loan for.
Click to expand...

Not true in all cases. What about a loan for a holiday that you have already been on? Or a wedding?
 
CCOVICH said:
That depends. Have you enough savings to survive a period of unemployment?
Click to expand...
Don't forget to factor in Jobseeker's Allowance (the imminent new name for Unemployment Benefit and/or Unemployment Assistance) where applicable.
 
payment protection cleared 2 of my loans in full. i'm glad i got the protection.
 
What lenders and payment protection underwriters were involved just out of curiosity?
 
Because I presume different lenders and their payment protection policies have different terms & conditions and I was just wondering who you dealt with. Who are Genworth? I've never heard of them before.
 
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