CREDIT LIFE INSURANCE

Credit life insurance, a form of decreasing term insurance, protects creditors such as banks. The borrower pays the premium, generally as part of the credit transaction, to cover the outstanding loan in the event he or she dies. The face value of a policy decreases as the loan is paid off until both equal zero. When loans are paid off early, premiums for the remaining term are returned to the policyholder. Credit accident and health, a similar product, provides a monthly income in the event the borrower becomes disabled.

CREDIT LIFE, AND CREDIT ACCIDENT AND HEALTH INSURANCE DIRECT PREMIUMS WRITTEN, 2004-2013

($000)

Year	Credit life	Credit accident and health
2004	$1,526,021	$1,554,325
2005	1,607,487	1,522,791
2006	1,564,124	1,442,604
2007	1,631,338	1,407,579
2008	1,563,207	1,251,052
2009	1,248,710	964,781
2010	1,247,848	930,578
2011	1,226,326	930,318
2012	1,159,524	957,294
2013	977,557	968,691

Source: SNL Financial LC.

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