• Skip to primary navigation
  • Skip to main content
CAFII | The Canadian Association of Financial Institutions in Insurance

Making Insurance Simple and Accessible for Canadians

  • Français
| Member Login
  • Français
  • Insurance
    • Close
    • Insurance
    • Mortgage Disability & Critical Illness Insurance
    • What is Travel Insurance?
    • What is Life Insurance for Personal Loans and Lines of Credit?
    • What is Disability Insurance for Personal Loans and Lines of Credit?
    • What is Credit Protection Insurance?
    • What is Mortgage Disability Insurance?
    • What is Travel Medical Insurance?
    • What is Credit Payment Protection Insurance for Personal Loans?
    • What is Credit Card Insurance?
    • What is Mortgage Life Insurance?
    • What is Mortgage Critical Illness Insurance?
    • What are Trip Cancellation and Trip Interruption Insurance?
    • What is Critical Illness Insurance for Personal Loans and Lines of Credit?
    • What is Job Loss Insurance?
    • Other Insurance
    • Close
  • Tools & Resources
    • Close
    • FAQ
    • Enquiries and Complaints
    • Helpful Links
    • How To Make A Claim
    • Close
  • About CAFII
  • News & Events
    • Close
    • News
    • Events
    • Close
  • Research & Insights
    • Close
    • Research
    • Insights
    • Close
  • Contact Us
Insurance

What is Insurance?

Insurance gives people peace of mind by protecting against a significant monetary loss and financial hardship through the sharing of a risk with someone else – usually an insurance company, which is sometimes partnered with a financial institution such as a bank or credit union.

Banks and credit unions sell Credit Protection Insurance, which is also known as Creditor’s Insurance or Creditor’s Group Insurance. This type of insurance is used to pay out a mortgage or or loan balance (up to the maximum specified in the certificate of insurance), or to make/postpone debt payments on the customer’s behalf in the event of death, disability, job loss or critical illness. It can be obtained for a variety of debt obligations, including mortgages, consumer loans, lines of credit and credit cards.

For example, if someone buys the mortgage life form of Credit Protection Insurance, their mortgage balance will be paid out (up to the maximum specified in the certificate of insurance) in the event of their premature death. This often means a family can afford to remain in their home after the death of a significant income earner, without financial duress. Credit Protection Insurance can be purchased to protect people against financial losses that could be caused by a wide range of risks.

What types of Insurance are there?Some of the most common types of insurance include:

Credit protection insurance

  • Mortgage life insurance
  • Mortgage disability insurance
  • Mortgage critical illness insurance
  • Mortgage job loss insurance
  • Personal loan life and disability insurance
  • Line of credit, disability and critical illness insurance
  • Credit card balance insurance

 

*Credit Protection Insurance is usually offered at economical group rates.

Other types of insurance

  • Travel medical insurance
  • Term Life insurance
  • Home and tenant insurance
  • Car insurance
  • Health and accident insurance
  • Mortgage default insurance
What is an Insurance Premium?

An insurance premium is the amount of money that someone pays in exchange for the insurance coverage they want. This amount is usually paid monthly for a defined period of time. The premium compensates the insurance company for taking on the monetary risk of a potential claim by the insured. The premium is based on a number of factors including the amount of insurance coverage desired, the age of the applicant, the profile of the applicant (e.g. health status for life insurance, driving record for car insurance, etc.), and other factors.

CAFII | The Canadian Association of Financial Institutions in Insurance
  • Insurance
  • About CAFII
  • News & Research
  • Tools & Resources
  • Contact Us

Privacy & Security | Terms Of Use | Accessibility | Canadian Association of Financial Institutions in Insurance, © 2023