By Keith Martin, Co-Executive Director, CAFII.
I’m pleased to report that CAFII recently added two new educational videos to our website.
The first video is about Job Loss Credit Protection Insurance, and it is designed to help consumers better understand how this type of insurance works and who can apply for it. The second video explains certain helpful features about Credit Protection Insurance that consumers may want or need to use.
Job loss Credit Protection Insurance versus Job Loss Insurance
According to research by Pollara Strategic Insights, over the past three years there has been a significant increase in the number of Canadians purchasing Job Loss Credit Protection Insurance. It also happens to be the most highly searched topic on our CAFII website. That’s not surprising, especially given the job uncertainty created by COVID-19.
However, many people confuse Job Loss Insurance with Job Loss Credit Protection Insurance, which is just one of the reasons why we made the video.
The former, which is sometimes called supplemental unemployment insurance, provides temporary income if a full-time employee is laid-off from work. This type of insurance is difficult to find, and expensive to purchase.
In contrast, Job Loss Credit Protection Insurance covers some or all of the monthly payments on insured debt obligations for a specific period of time, or until the insured returns to work – whichever comes first – should a person involuntarily lose his/her full-time job. This type of insurance is available from some financial institutions as an “add on” to life or disability insurance on mortgages and some types of personal loans. In some cases, it may also be added to balance protection coverage for credit cards.
Consumer friendly features of Credit Protection Insurance
As our video explains, CAFII members provide details about credit protection insurance to help consumers make informed decisions. This includes plain language information about products, online tools that provide pricing quotes, and trained representatives in branches and call centres who can answer questions.
CAFII members also provide information about helpful features of credit protection insurance that consumers may want or need to use. For example, customers have a “review” period, typically up to 30 days, during which they can cancel their coverage and receive a full refund of the premium paid.
If insured customers need to make a claim, CAFII members can help facilitate the claims process in person, by phone, or online.
The video also outlines the procedures in place for handling consumer enquiries and complaints, including what to do if someone is unhappy with the outcome.
Furthermore, the video notes that recent updates to Canada’s financial consumer protection framework have reinforced measures by CAFII members to ensure fair treatment of customers.
These two videos are the latest in a series aimed at simplifying insurance products and services for Canadian consumers. They supplement eight other informative videos on the CAFII website, with more still to come.
