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There are various life insurance plans out there, and each one is designed to help your loved ones recover in the event of a serious loss. However, credit life insurance exists to help pay off any outstanding debt if the policyholder dies.1
The face value of life insurance is the dollar amount equated to the worth of your plan.2 Usually, the face value in a credit life insurance plan decreases over time at the same rate as the debt is being paid off until both values eventually reach zero.1 Essentially, having credit life insurance means that you may be able to eliminate debt from you and your loved ones’ lives entirely.
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Credit life insurance might be particularly helpful if a loved one or family member co-signed with you on a loan or mortgage. If you were to pass suddenly, there would be a plan in place to help protect them from having to pay off the debt on their own.1
Aflac doesn’t offer credit life insurance, but we have two other plans that may fit your needs for life insurance coverage. Term life insurance help provide coverage for a certain period and is an excellent choice for those looking to save money upfront. On the other hand, whole life insurance is a greater financial investment, but you are protected for your entire life.
The primary coverage benefit of credit life insurance is the protection it allows joint borrowers. These plans help ensure that one person is not left to cover the outstanding debt after the other joint borrower passes.1
For example, let’s say you and your partner sign an auto loan together, and the policyholder passes away. Credit life insurance helps protect your partner from paying off the remaining amount on their own.
In some cases, credit life insurance policies can be written into the loan you are getting.1 However, it is illegal for an entity to require credit life insurance in a loan, so it isn't required to have credit life insurance for a loan.1
Usually, there is no medical exam in credit life insurance because these plans have less scrutinous underwriting requirements.1
Don’t wait until it’s too late. Help cover yourself and your family with coverage from Aflac.
Get StartedThe cost of credit life insurance varies depending on the specific plan and company you are working with. However, if the credit life insurance plan is built into a loan, you can expect the recurring payments to be higher because they coincide with the amount of the loan.1
While we can’t provide you with an exact cost for credit life insurance, you can use our life insurance calculator to get a better idea of what your costs will look like if you choose a whole to term life insurance plan with Aflac. Your life insurance premiums may be impacted by your location, age, coverage goals and the number of dependents in your life.
Credit life insurance is not the only option if you hope to help protect your partner from unwanted debt. Term life insurance may be a better solution because the beneficiary usually receives the death benefit tax-free. In addition, term life insurance is usually less expensive than credit life insurance, and you can specify how long you need coverage for.2
Since term life insurance is budget friendly, you can use the money saved on premiums to help pay off any debt. Depending on the unique situation, there may even be funds left over for other needs.
Also, whole life insurance may be a good route if you are looking for coverage that lasts your entire life, but it can be more expensive.3 However, the death benefit in whole life insurance types of plans is usually guaranteed, which can help minimize financial stressors for your beneficiary.3
Credit life insurance can be a helpful solution for paying off debt, but we encourage you to explore all your options to find the best life insurance plan for your needs. Aflac offers whole and term life insurance that help provide the coverage you need at a comparable price. Chat with an agent and get a quote to discover which life insurance plan is best for your lifestyle.
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The face amount of life insurance is the money your loved ones will receive if you pass away. Learn how life insurance face value works and how to calculate what yours will be.
Looking into getting a term life insurance policy? Find out what term life insurance is and its features, rates, and benefits.
The face amount of life insurance is the money your loved ones will receive if you pass away. Learn how life insurance face value works and how to calculate what yours will be.
Looking into getting a term life insurance policy? Find out what term life insurance is and its features, rates, and benefits.
1 Investopedia - Credit Life Insurance: What it is and Who Needs it. Updated July 23, 2023. Accessed January 27, 2025. https://www.investopedia.com/terms/c/credit_life_insurance.asp.
2 Investopedia - Life Insurance: What It Is, How It Works, and How To Buy a Policy. Updated September 17, 2024. Accessed January 27, 2025. https://www.investopedia.com/terms/l/lifeinsurance.asp.
3 Investopedia - Whole Life Insurance: How It Works, With Examples. Updated November 25, 2024. Accessed January 27, 2025. https://www.investopedia.com/terms/w/wholelife.asp.
Content within this article is provided for general informational purposes and is not provided as tax, legal, health, or financial advice for any person or for any specific situation. Employers, employees, and other individuals should contact their own advisers about their situations. For complete details, including availability and costs of Aflac insurance, please contact your local Aflac agent.
Aflac coverage is underwritten by American Family Life Assurance Company of Columbus. In New York, Aflac coverage is underwritten by American Family Life Assurance Company of New York.
Aflac life plans - B60000 series: In Arkansas, Idaho, Oklahoma & Virginia, Policies: ICC18B60C10, ICC18B60100, ICC18B60200, ICC18B60300, & ICC18B60400. Not available in Delaware. Q60000 series/Whole: In Arkansas & Delaware, Policy Q60100M. In Idaho, Policy Q60100MID. In Oklahoma, Policy Q60100MOK. Not available in Virginia. Q60000 series/Term: In Delaware, Policies Q60200CM. In Arkansas, Idaho, Oklahoma, Policies ICC18Q60200C, ICC18Q60300C, ICC18Q60400C. Not available in Virginia.
Aflac Final Expense insurance coverage is underwritten by Tier One Insurance Company, a subsidiary of Aflac Incorporated and is administered by Aetna Life Insurance Company. Tier One Insurance Company is part of the Aflac family of insurers. In California, Tier One Insurance Company does business as Tier One Life Insurance Company (NAIC 92908).
In AR, DE, ID, OK and VA: Policies ICC21-AFLLBL21 and ICC21-AFLRPL21; and Riders ICC21-AFLABR22, ICC21-AFLADB22, and ICC21-AFLCDR22. Aflac Final Expense policies are not available in New York.
Coverage may not be available in all states, including but not limited to DE, ID, NJ, NM, NY, VA or VT. Benefits/premium rates may vary based on state and plan levels. Optional riders may be available at an additional cost. Policies and riders may also contain a waiting period. Refer to the exact policy and rider forms for benefit details, definitions, limitations, and exclusions.
Aflac does not offer Universal or Variable Universal life insurance.
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Aflac New York | 22 Corporate Woods Boulevard, Suite 2 | Albany, NY 12211
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