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CREDIT INSURANCE AND DEBT PROTECTION PRODUCTS CAN RELIEVE CONSUMER ECONOMIC WORRIES
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Contact: William F. Burfeind
Executive Vice President
(312) 939-2242
Chicago, August 6, 2008 – With consumer debt at all time record levels, and mounting concerns about the mortgage crisis, banking stability and rising inflation driven by the cost of oil-related commodities, it’s a good time for consumers to take a look at protecting repayment of their debts, the Consumer Credit Industry Association (CCIA) said today.
As recently reported in The New York Times, total American consumer debt stands at $2.56 trillion, an increase of 22 percent just since 2,000, average household credit card debt is $8,565, up nearly 15 percent since 2,000 and daily headlines report billion-dollar banking losses, a teetering mortgage industry and falling home prices.
“Even in this worrisome economy, when it’s understandable that consumer confidence is down and consumer worries are on the upswing, there are helpful steps consumers can take like assuring repayment of debt in certain circumstances,” said CCIA Executive Vice President William F. Burfeind.
“Whether with traditional consumer credit insurance or debt protection products like debt cancellation or suspension contracts, borrowers can be sure their loan payments will be made for them in the event of death, illness, disability, involuntary unemployment or loss of or damage to property purchased with a loan,” said Burfeind, noting, “That’s what credit insurance or debt cancellation and suspension products do.”
The CCIA executive observed, “While our bank deposits are insured up to $100,000 by the FDIC there is no comparable public program to assure that if we can’t repay our loans someone else will step in to protect us. But there are means to do this if consumers who want to take steps to protect their personal and family finances.”
Burfeind said, “As recently reported, household debt including mortgages now constitutes 19 percent of household assets and that’s compared to 13 percent as recently as 1980. Credit insurance and debt cancellation and suspension contracts can assure repayment of such debt in the event of insured or contracted events. That’s why many consumers facing todays economic and financial challenges may want to examine the benefits and peace of mind that credit insurance and debt protection products deliver.”
He concluded, “The CCIA urges all consumers to review their financial situation, including how much they owe, how much life or disability insurance they have and what they will need to get by in the event of an unexpected crisis like a death, disability or loss of a job. It’s a good thing to do at least once a year and it’s an even more important thing to do now in this difficult economy.”
Credit insurance and related debt cancellation products insure or otherwise provide for the repayment of debt in the event of an insured event like the death, disability or unemployment of the borrower or the loss of property purchased from the proceeds of an insured loan.
Based in Chicago, the 120-member CCIA is a trade association of insurance companies and other financial service providers selling or servicing consumer credit insurance, credit related lines of insurance, and other consumer credit protection products including debt cancellation and suspension contracts or agreements.###
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