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					Payment Protection Plan
         Credit Disability
           Credit Life

   Product & Presentation
  Specialty License Training
           Program

                  Associate Member
Credit Insurance Specialty
License Training Program



 To comply with the training requirements
set forth in the Section 1 (d) of Art. 21.09,
         Texas Insurance Code.
                        Table of Contents
Topic                                                                                        Page Number
Agenda ....................................................................................................................1
Introduction ………………………………………………………………….…..………….2
Credit Insurance Overview …………………………………………………...…………..3
Characteristic of Credit Insurance ............................................................................4
Types of Eligible Loans ………………………………………………………...………….5
Credit Life – General Information .............................................................................6
Credit Disability – General Information………………………………………...………..9
Disability Waiting Period …………………………………………………………...…….11
Plan Highlights – Underwriting Guidelines ..............................................................14
Frequently Asked Questions ..................................................................................16
Selling Credit Life and Disability Insurance ............................................................23
Objections ..............................................................................................................30
Glossary of Terms ………………………………………………………………...……...36
Consumer Bill of Rights/Notification ……………………………………………………40
American Bankers Life Assurance Company of Florida Insurance Policy…………..41
    Agenda

 Credit Life Insurance


  Disability Insurance


Selling Credit Insurance




                           1
                                    Introduction
This booklet provides information that will enable you to offer the Payment Protection Plan with confidence
to all of your customers who apply for a loan.

What is Payment Protection Plan?
The Payment Protection Plan is a credit insurance plan that includes the following coverage's:
       Credit Disability (Credit Accident & Health)
       Credit Life

What Can You Expect?
After reviewing this manual and the Policies of Insurance, you will be able to:

         Explain what credit insurance is and how it benefits your customers, you and your company.

        Describe the credit insurance coverage's that your company offers.

         Present the Payment Protection Plan accurately and confidently to your customers.

         Respond to commonly asked questions about the Payment Protection Plan.

Glossary of Terms
If you encounter an unfamiliar word or phrase, refer to the Glossary of Terms located in the back of this
manual.
                                                                                                        2
        Credit Insurance Overview
What is Credit Insurance?
    Credit insurance is term insurance that is purchased in conjunction with a consumer credit transaction.

Types of Eligible Loans:

         Consumer loans

         Commercial loans

Common Characteristics

         Coverage matches the credit. That is, there is usually coverage for the exact term and amount of
         the loan.

         The lender is the first beneficiary of the policy proceeds.

         A single premium is paid at the inception of the insurance. The premium is financed with the loan.

         The same premium rate is charged to every customer of a financial institution regardless of age,
         gender and occupation.

                                                                                                        3
    Characteristics of Credit
          Insurance
Applicant’s statement of insurability
Coverage is not available to any applicant for credit life and credit disability insurance that is
unable to certify the parameters of good health. The health statement that a customer must
certify does not contain questions relating to high blood pressure and diabetes. All
applicants for credit disability must also certify they are working for wages or profit for 30
hours or more per week on the effective date of coverage.

Rates and policy equipment
Filed with and/or approved by the Texas Department of Insurance. Individuals on war/act of
war/military duty or non-scheduled air travel are not excluded. Suicide exclusion only for the
first two years of the policy.

Beneficiary designation
The creditor is the first beneficiary. If benefits exceed the amount necessary to pay off the
debt, the excess is paid to a named second beneficiary. In the absence of a second named
beneficiary, the debtor’s estate becomes the beneficiary.

Terminations and Refunds
Coverage automatically terminates and the debtor is entitled to a refund of any unearned
premiums in the event the loan is prepaid, renewed or refinanced prior to the scheduled date
of maturity.
                                                                                                 4
Types of Eligible Loans
       Consumer Loans

       Commercial Loans

       Real Estate Loans

       Agriculture Loans

       Balloon Loans

       Irregular Loans


                           5
Credit Life Plan Highlights
                   Single Premium

                   Single Coverage

                   Joint Coverage

                   Gross Coverage

                                 GROSS
                                MAXIMUM
                     AGE      PER INDIVIDUAL    TERM
                   18 - 55       $150,000    120 months
                   56 - 65       $100,000    120 months


                   Maximum Age at Issuance: 65
                   Age Plus Term Not to Exceed: 71

                   No Occupational Limitation

                   No Physical Examination



     No Health Statement for High Blood Pressure or Diabetes
        No Act of War (declared or undeclared) Exclusion
          No Flight in Non-Scheduled Aircraft Exclusion        6
 Credit Life General Information
What is Credit Life?
   Credit life insurance pays the insured’s covered loan balance in the event of his or her death.

Single & Joint Coverage
    Credit life insurance can be offered to one borrower (single coverage) or to the borrower and his or her
    co-borrower (joint coverage). The policy terminates upon the death of either one of the insured's. If
    the two borrowers die simultaneously, then only one death benefit is paid.

Advantage of Joint Coverage
   The opportunity for the borrower to purchase joint coverage is a great advantage because there is a
   substantial savings over the alternative of buying two single life policies. Joint life is like a “blue light
   special”, buy one full price, get the second one ½ price. Borrowers must be spouses or business
   partners to obtain joint life coverage.

Types of Credit Life Coverage
   The most common types of life coverage include:
        Gross Pay
        Level
        Net Pay
        Truncated
                                                                                                           7
                   Credit Life Facts
Know the Facts…Here are some facts that support the importance of credit life insurance


                                     Did You Know . . .

   47 percent of all Americans have no life insurance.

   24 percent of all households have no life insurance.

   34 percent of all insurance bought is employee group coverage

   Chronic illness is the leading cause of death in the U.S. It accounts for 3 out of 4 deaths and
   affects more than 100 million people. U.S. Department of Health & Human Services Fact Sheet,
   October 14, 1998.




                           When tragic and sudden deaths occur,
                       having Payment Protection to help pay off debt
                   gives the grieving family one less thing to worry about.
                                                                                               8
Credit Disability Plan
     Highlights
                       Single Premium

                      Single Coverage Only

                      Age Limits (18-65)

                      Maximum Monthly Benefits Per Individual
                      3 – 60 months – $1,000
                      61 – 120 months - $500

                      Maximum Term: 120 months
                      Term Plus Age Not to Exceed: 66

                      Must be employed
                      (Minimum 30 hours a week)

                      Good Health Statement



  No Health Statement for High Blood Pressure or Diabetes
     No Act of War (declared or undeclared) Exclusion
       No Flight in Non-Scheduled Aircraft Exclusion            9
         Credit Disability General
                Information
What is Credit Disability Insurance?
   Credit disability insurance pays a portion of the insured’s monthly loan payment for each day
   he or she is totally disabled. Disability may be a result of an accident or illness. Proceeds
   are payable as 1/30th of the monthly payment for each day the insured is disabled.

How Proceeds are Paid
           Example:
           Total monthly payment:                          $300.00
           # Days of disability:                           45
           Calculate proceeds/day:                         $300.00/30 = $10.00
           Multiply daily proceeds by # days of disability: $10.00 x 45 days = $450.00

Total Disability
    Total disability is defined as any physician-documented accident or illness that, for the first
    12 months, prevents the insured from working in their normal occupation. For any disability
    beyond the first 12 months, the insured cannot engage in any occupation for which he or
    she is reasonably qualified by education, training, or experience.


                                                                                                      10
     Credit Disability Waiting
              Period
Waiting Period

   To qualify for disability benefits, the insured must be totally disabled for 14
   continuous days.

Retroactive Plan

   With the retroactive plan, benefits are paid from the first day of disability once
   the waiting period is over.




                                                                                        11
                       Waiting Period
The retroactive plan provides benefits that are payable from the first day of disability. Once the
14th day of disability has passed, benefits become due and payable from the first day of disability
and continue for each consecutive day of disability.




                Monthly disability benefit (monthly payment) ..................….................... = $300
                Daily benefit = $300/30 ...........................................…...…..................... = $10
                Benefit payable = 20 days of disability x $10 .............….....…................ = $200


                                                                                                                      12
            Credit Disability Facts
Know the Facts…Here are some facts that support the importance of credit disability insurance

                                      Did You Know . . .
   Nearly 1 in 5 people will become disabled for 5 years or more before age 65. Federal Reserve
   Bulletin, 1997.

   About 2.9 million injuries and illnesses in 1997 were lost workday cases; that is, they required
   recuperation away from work or restricted duties at work, or both. Bureau of Labor Statistics, U.S.
   Department of Labor.

   On the average, there are 11 unintentional-injury deaths and about 2,370 disabling injuries every
   hour during the year.

   While you make a 10-minute safety speech, two persons will be killed and about 396 will suffer a
   disabling injury. Costs will amount to $8,920,000.




                                                                                                   13
                     Plan Highlights
                                  Types of Insurance
CREDIT LIFE                                          CREDIT DISABILITY (A&H)

    Single Premium
                                                         Single Premium
    Single Coverage

    Joint Coverage                                       Single Coverage Only

    Gross Coverage                                       Age Limits (18-65)
             GROSS
            MAXIMUM                                      Maximum Monthly Benefits Per Individual
 AGE      PER INDIVIDUAL    TERM                         3 – 60 months – $1,000
18 - 55     $150,000     120 months                      61 – 120 months - $500
56 - 65     $100,000     120 months

                                                         Maximum Term: 120 months
    Maximum Age at Issue: 65                             Term Plus Age Not to Exceed: 66
    Age plus Term Not to Exceed: 71

    No Occupational Limitation                           Must be employed
                                                         (Minimum 30 hours a week)
    No Physical Examination

                                                         Good Health Statement

                      No Health Statement for High Blood Pressure or Diabetes
                         No Act of War (declared or undeclared) Exclusion
                           No Flight in Non-Scheduled Aircraft Exclusion                           14
Frequently Asked Questions
If I decide later that I want the insurance, may I enroll at that
time?

   You may only enroll at the time you are obtaining your loan. But
   remember, if you enroll today and later change your mind, you
   can cancel for a full refund of the unearned premium. This
   premium will be applied to your principal, and your loan
   payments will not change.




                                                                 15
Frequently Asked Questions
What if I have other insurance plans?        Will they affect the
benefits I may receive from this plan?

   Our Credit Insurance is designed to protect this particular debt
   for a specific term. The benefits you may receive from this plan
   are not affected by your other coverage.




                                                                  16
Frequently Asked Questions

Will I be covered during military duty?

   Yes. Our Credit Insurance has no occupational limitations,
   which means any occupation is covered by this plan and that
   includes military service.




                                                             17
Frequently Asked Questions
What if I miss some loan payments and then I pass away? Will
the entire debt be paid off?

   The insurance coverage continues to decrease as if you were
   making your loan payments on time.          Any delinquent
   payments past 60 days will not be covered.




                                                           18
Frequently Asked Questions
What if I become permanently disabled? Will this plan make
my payments until the debt is paid off?

   Yes. As long as your payments are up to date at the time you
   become disabled and you purchased coverage for the full term
   of the loan, payments will continue to be made until the debt is
   paid off.




                                                                      19
Frequently Asked Questions
Is the plan optional?

   Yes. This plan is optional.




                                 20
Frequently Asked Questions
If I do not purchase credit insurance, will this affect my loan
approval or the loan processing time?

   No. It will not affect you loan approval or processing time.




                                                                  21
Selling Credit Life & Disability
          Insurance




                                   22
Credit Insurance Benefits
Benefits to the Borrower

  The borrower has a sense of security knowing that his or her loan is
  covered in the event of a sudden accident or illness, or unexpected
  death.

  The borrower only pays for what he or she needs. If the loan is
  paid off early, any unused premium is credited to the payoff
  amount.

  Many borrowers are under-insured. They know this, but tend to
  avoid the task of purchasing more insurance. Since the Payment
  Protection Plan is an easy and convenient way to meet a portion of
  their insurance needs, many borrowers choose to enroll.


                                                                         23
Credit Insurance Benefits
Benefits to You - The Lender

If the customer suddenly becomes disabled or dies unexpectedly, you
have the extra security knowing that the borrower has a way to repay
the loan obligation.

   Knowing the bank won’t have to call a widow, widower, or disabled
   borrower and collect on an unpaid balance increases your
   customer relations.

   The Payment Protection Plan not only helps build customer
   relationships, but it also provides additional profit for your
   organization.



                                                                       24
                                         Sales Tips
100% Presentation
    Presenting the Payment Protection Plan should be as natural as selling a loan. Here are a few suggestions for making
    the Payment Protection Plan a natural tie-in to your loan sales presentation.

Ask Permission to Ask Questions
    When a customer calls or stops by and requests a loan quote, ask the customer the following question:

    “May I ask you a few questions first?”

                                  If the customer says, “yes,” follow up with the next question:

                                       Determine the Range of Monthly Payments

    “What range of monthly payments are you looking for?”

                                               Quote the Loan Payment
                            Always quote the loan payment to include the Payment Protection Plan.
                                    Disclose the cost of the plan to the customer up front.

          “Mr./Ms. Customer, your monthly payment would be $_______, which includes the principal, interest,
      (other fees) and also about $________ for the optional Payment Protection Plan. How does that sound?”

Questions
    After you quote the payment, your customer may have questions about the plan. The following information will help you
    answer these questions.
                                                                                                                    25
                            Sales Tips
What is it?         “Here’s what the plan covers:”

                    If you die unexpectedly, your covered loan balance is paid.

                    If you become disabled as a result of an accident or illness,          your loan
                    payments will be made for the time you cannot work.

                    A definition of the terms and a full description of the coverage's are included in
                    the Certificate of Insurance you would receive.”

Does it Affect my   “Your decision to enroll in the plan does not affect your loan approval
Loan Approval?      or the processing time. This is a voluntary plan we offer as a convenient
                    way to protect your new loan.”




                                                                                                 26
                            Sales Tips

Even if your customers do not ask these questions, it’s important that you let them know:

   How much the Payment Protection Plan costs.

   It’s an optional plan.

   Their decision whether to enroll does not affect their loan approval or the loan
   processing time.

                   Payment Protection is very rarely asked for,
  you must offer Payment Protection 100% of the time to every eligible customer.




                                                                                      27
                                      Sales Tips
More Tips
    Here are some more tips that will help you present Payment Protection Plan to EVERY customer.

Nothing Convinces More Than Conviction
    Some lenders feel uncomfortable offering the Payment Protection Plan to every customer. To alleviate this
    feeling, it’s helpful to understand what it is that the Payment Protection Plan does for the customer. This
    understanding, along with quoting the payment with Payment Protection Plan EVERY time, will greatly
    diminish this feeling of discomfort.

Determine Eligibility Early On
    Determine the customer’s eligibility as early on in the loan process as possible. If your customer likes it, get
    the health questionnaire out and say, “Great, let’s see if you qualify.” Then ask your customer to complete
    the health questionnaire. You can ask customers to complete the health questionnaire at the same time
    they are completing the loan application.

Ensure Borrower and Co-Borrower Answer Health Questions
    At no time should the health questions be answered by anyone other than the borrower and co-borrower. If
    the borrower and co-borrower are unable to complete the health questions and sign the Application for
    Credit Insurance form, do not issue insurance. By quoting the Payment Protection Plan in every payment,
    you have an automatic way to tell every customer about it.

Quote Payment Protection Plan With Every Loan Quotation
    By quoting the Payment Protection Plan in every payment, you have an automatic way to tell every
    Customer about it.
                                                                                                                       28
        Overcoming Objections
No matter how well your initial introduction may go, there are times when the customer is simply
going to say “No”.

                              An objection is usually a result of:

    Lack of Information.

    Discomfort with the method used in presenting the product.

    Previous experience.

                  Knowing this you can avoid these stumbling blocks by:

    Presenting the product in a manner that is natural and confident.

    Listening carefully to identify your customers concerns.



                                                                                                   29
         Overcoming Objections
Objection    “I have plenty of insurance.” / “I already have insurance.”



Empathize   “Some of our customers have felt the same way. However, they found
             that their existing insurance was not enough to protect their New
             Obligation.”

Probe        “When you purchased that insurance, was it for a specific purpose?”

Inform       “The payment protection plan was not designed to replace your other
             insurance, but to supplement your insurance program. Your existing
             insurance could then be used for the initial reason you purchased it.”

Check        “Do you agree this protection is something you should consider?”

Ask          “Do I add the payment protection plan you your loan?”


                                                                                30
         Overcoming Objections
Objection   “I can’t afford it.”

Empathize   “I can appreciate how you feel. However, by financing the premium
            as part of the loan, it makes it cost effective for the protection it
            provides.”

Probe       “Keep in mind that the payment protection plan is only __ day.”

Inform      “With the payment protection plan, your family would inherit an
            asset, not a debt.”

Check       “Do you think it is something you should consider?”

Ask         “Can I proceed in adding the credit insurance?



                                                                              31
         Overcoming Objections

Objection   “I plan on paying back this loan early.”

Empathize   “A lot of our customers do.”

Probe       “When do you plan to pay your loan off?.”

Inform      “The payment protection plan is specifically designed for early
            payoff. You only pay for what you use. If the loan is paid off early,
            you will receive a refund of the portion of the protection plan that
            you did not use.”

Check       “Doesn’t that make the protection plan fit your needs?”

Ask         “Would you like to add the credit insurance at this time?”


                                                                             32
      Overcoming Objections
Objection   “I can get it cheaper from my agent.”

Empathize   “Some of our customers have felt the same way. However, after
            contacting their agent, they found that their agent would not or could
            not provide for the amounts of protection that fit either the dollar
            amount or term of the loan.”

Probe       “Have you contacted your agent for this additional protection for this
            new obligation?”

Inform      “You will find our payment protection plan not only more convenient
            from underwriting requirements but because it’s a group plan, it’s
            more economical and can be financed as part of your loan.”

Check       “Can you see how much more the payment protection fits your
            needs?”

Ask         “Can I proceed in adding the credit insurance?”
                                                                             33
         Overcoming Objections
Objection   “I don’t need it.”

Empathize   “Some of customers initially felt that way. However, after carefully
            considering the possible hardships their family could face without
            this protection, they found they needed it.”

Probe       “Have you considered the repayment of this new obligation if
            something were to happen to you?”

Inform      “If something did happen to you, your family could lose their credit
            rating and (whatever item they are financing) including any
            payments you made and your down payment.”

Check       “Would you agree it’s worth investing $________ a day to protect
            $_______ and your family’s financial future?”

Ask         “Do I add the payment protection plan to your loan?”
                                                                            34
                Glossary of Terms
A&H
    A&H stands for accident and health. Credit disability insurance is also called Credit A&H.
Claimant
    A borrower who is covered by a credit insurance policy and who files a claim for a loss that
    is covered by the policy.
Closed-End Loan
    A loan that is for a specified amount and a fixed term. The amount that is borrowed cannot
    be increased.
Effective Date
    The date the insurance coverage begins. It is usually the effective date of the loan.
Gross Pay Life Coverage
    Gross pay life (a.k.a., gross note, straight line decreasing, total of payments) coverage is
    credit life coverage that covers the total of loan payments. That is, principal, interest,
    insurance premium, and other loan-related fees.
Group Policy
    A credit insurance policy that is issued to a lender, where the group is defined as the
    consumers who obtain loans from that lender. When a borrower enrolls, he or she is
    enrolled in the group policy and receives a certificate of insurance that shows evidence of
    insurance.
Installment Loan
    A loan that is generally repayable in equal monthly payments.
                                                                                                   35
                Glossary of Terms
Joint Credit Life
    Credit life insurance that insures the borrower and the co-borrower.
Level Term Life Coverage
    Level term life coverage provides a level and constant amount of insurance throughout the
    entire term of the loan. This type of coverage may be written to include the principal, fees,
    insurance premium, and the interest or any portion of the total note. Level coverage is
    typically written when there are irregular payments and/or balloon notes. Most states do not
    permit level coverage to be written on closed-end installment loans.
Line of Credit
    A borrowing limit that has been pre-approved by the lender. Monthly outstanding balance
    coverage (MOB) is generally written on lines of credit. (See also: open-end loan.)
Monthly Outstanding Balance Coverage (MOB)
    A credit life and disability benefit that pays the outstanding balance of the loan (or line of
    credit) on the date of death and pays the minimum monthly payment in the event of
    disability. Monthly premiums (usually an amount per $100 or $1,000 per month of the
    outstanding balance) are charged for the insurance. This type of coverage is usually offered
    on lines of credit and open-end loans.
Net Pay Life Coverage
    Net pay (a.k.a., net payoff and net decreasing) coverage is credit life coverage that covers
    the net balance of the loan. That is, principal, insurance premium, and other loan-related
    fees but not the unearned interest. If the insured dies, the insurance benefit should be equal
    to the net loan balance that is due to the creditor. This type of coverage follows a specific
    amortization schedule for the term of the loan.
                                                                                                     36
                 Glossary of Terms
Open-End Loan
    A loan which may increase in amount at any time. The term of the loan is not fixed. The
    borrower makes monthly payments for any amount from the lender’s required minimum
    payment up to the outstanding balance of the loan. (See also: line of credit.)
Penetration Rate
    A rate that reflects the percentage of eligible borrowers who enroll in credit insurance.
Preexisting Condition
    A condition for which the insured has been treated and/or diagnosed by a physician prior to
    the effective date of the insurance policy.
Premium
    The amount paid for the specified insurance coverage.
Retroactive Waiting Period
    A type of waiting period in which an insured must wait the specified number of days before
    receiving benefits. Once that waiting period is over, benefits are payable back to the first day
    of loss.
Single Premium
    A premium that is charged only once at the inception of the insurance coverage.
Six-by-Six Preexisting Condition
    A preexisting condition exclusion for disabilities. A disability is not covered if the insured
    becomes disabled from a preexisting condition within six months after the effective date if
    any treatment and/or diagnosis for that preexisting condition occurred within six months prior
    to the effective date.
                                                                                                       37
                Glossary of Terms
Principal
    (As in “loan principal.”) The cash that is advanced to the borrower or the part of the
    product’s purchase price that is being financed. Other portions of the loan may include
    interest and other fees.
Truncated Coverage
    Truncated life coverage is written to insure the first portion of the loan. It covers the net
    balance of the loan. That is, principal, insurance premium, and other loan-related fees but
    not the unearned interest. This type of coverage follows a specific amortization schedule for
    the term of the loan. Truncated coverage means partial coverage.




                                                                                                    38
Consumer Bill of Rights
The Bill of Rights is a summary of the consumers rights and does not become part
of the policy.

Texas and federal law give the consumer certain rights regarding credit life, and
credit accident & health (disability) insurance.

It also provides a toll-free telephone number to the Texas Department of
Insurance.

It provides the consumer with information on enforcing their rights.




    Consumer Notification
You must inform a prospective consumer of credit insurance related products
that the purchase of coverage is not a condition of the extension of credit, and
the coverage may be purchased form an agent other than the lender or affiliate
of the lender.
                                                                              39
  The insured must be provided with a copy of the
following with each new policy or certificate issued!


 IMPORTANT NOTICE REQUIREMENT
        Outlines procedures for obtaining information and filing complaints.


Provided in both English and Spanish.


Provides toll-free numbers and mailing address for insurers, the Texas Department of
Insurance and mailing addresses.


Outlines procedures for obtaining information for resolving claim disputes and filing
complaints.



                                                                                  40
   American Bankers Life
Assurance Company of Florida

      Insurance Policy




                               41
                          AMERICAN BANKERS LIFE ASSURANCE COMPANY OF FLORIDA
                                                    Administrative Offices: 260 Interstate N. Circle, NW, Atlanta, GA 30339-2111
                                                                  11222 Quail Roost Drive, Miami, FL 33157-6596
                                                              (Hereinafter called “We,” “Us,” or “Our”The Company)
LOAN NO.                                                      BC               SCHEDULE / APPLICATION                       POLICY NO.
INSURED DEBTOR’S NAME                                          DOB       AGE (Max. 65) SOCIAL SECURITY NO.*     INSURED DEBTOR’S ADDRESS

INSURED JOINT DEBTOR’S NAME (IF ANY) (Life Only)              DOB        AGE (Max. 65) SOCIAL SECURITY NO.*

ACCT. NO.                     CREDITOR BENEFICIARY                                                              SECOND BENEFICIARY, DEBTOR’S ESTATE
                                                                                                                OR
NUMBER OF ODD                            SUBSTANTIALLY EQUAL
DAYS IN LOAN                             PERIODIC PAYMENT:                    MONTHLY                                 QUARTERLY         SEMI-ANNUAL         ANNUAL
                           TYPE OF COVERAGE                                  EFFECTIVE        TERM IN         EXPIRATION     INITIAL AMOUNT    INSURANCE        SINGLE
                                                                            DATE OF INS.      MONTHS            DATE OF       OF INSURANCE     REDUCTION     PREMIUM FOR
                                                                                            (MAXIMUM)         INSURANCE                                          TERM
                                                                                             (120 Mos.)
DECREASING TERM LIFE                               SINGLE ❐    JOINT ❐
(Maximum Total Coverage on One Life is $150,000)
LEVEL TERM LIFE (Residual)                         SINGLE ❐    JOINT ❐                      (120 Mos.)
(Maximum Total Coverage on One Life is $150,000)
NET BALANCE DECREASING TERM LIFE             SINGLE ❐       JOINT ❐                         (120 Mos.)
(Maximum Total Coverage on One Life is $100,000)
TOTAL DISABILITY BENEFITS             (max. $1000/mo. for 0-60 mos.)                        (120 Mos.)                                 MONTHLY
                                     (max. $500/mo. for 61-120 mos.)                                                                   BENEFIT
BEGIN ON THE                                    DAY OF
DISABILITY IF THE INSURED IS DISABLED
CONTINUOUSLY FOR                 DAYS. (MAX. AGE 65)                             TOTAL AMOUNT
                       PLEASE COMPLETE FOR                                                                                                     TERM OF LOAN
                                                                              FINANCED (INCLUDING
                         NET BALANCE ONLY                                          PREMIUM)                                        APR                   MOS.
*SOCIAL SECURITY NUMBER IS NOT REQUIRED TO OBTAIN INSURANCE
Certification and signature(s) are necessary for: ALL AGES, ALL AMOUNTS.
I CERTIFY THAT I AM: IN GOOD HEALTH; UNDER 66 YEARS OF AGE; AND THAT I HAVE NOT BEEN DIAGNOSED OR TREATED BY A PHYSICIAN AS HAVING OR BEEN A PATIENT IN A
HOSPITAL WITHIN THE PAST TWENTY-FOUR (24) MONTHS FOR ANY IMPAIRMENT OR DISEASE OF: 1) THE HEART OR CIRCULATORY SYSTEM; 2) THE LUNGS OR RESPIRATORY
SYSTEM; 3) THE STOMACH OR DIGESTIVE SYSTEM; 4) THE BRAIN OR NERVOUS SYSTEM; OR FOR 5) CANCER OR ANY MALIGNANT DISEASE; OR 6) ACQUIRED IMMUNE DEFICIENCY
SYNDROME OR ANY AIDS RELATED DISEASE; AND IF APPLYING FOR DISABILITY COVERAGE; 7) DISEASE OR INJURY OF THE SPINE, BACK OR NECK; 8) MENTAL OR NERVOUS
DISORDERS; OR 9) DRUG ADDICTION OR ALCOHOLISM; AND AM GAINFULLY EMPLOYED ON A FULL-TIME BASIS.
                                                                                           YES          NO     YES         NO
                                             IS THIS STATEMENT TRUE?
                                                                     INITIALS OF:          Debtor Applicant Joint Debtor Applicant
I FURTHER CERTIFY THAT I HAVE READ THE STATEMENT SET FORTH ABOVE AND THAT TO THE BEST OF MY KNOWLEDGE IT IS TRUE. I UNDERSTAND THAT ANY MISREPRESENTATION
MATERIAL TO THE RISK MAY BE USED BY AMERICAN BANKERS LIFE ASSURANCE COMPANY OF FLORIDA TO DENY A CLAIM OR VOID THIS COVERAGE.



                                     Insured Debtor                                   Joint Second Debtor (Spouse or Business Partner)                     Date
                                                 WARNING: THIS INSURANCE MAY NOT BE ENOUGH TO COMPLETELY PAY OFF YOUR LOAN.




                                                             LIFE INSURANCE
      In accordance with and subject to the provisions and conditions set forth hereafter, we will pay the benefit to the beneficiary
      when we receive proof of an insured’s death. “Proof” means: a certified copy of the death certificate; or death decreed by a
      court order. All death claims will be paid no later than two months after receipt of due proof and the right of the claimant to
      the proceeds.
      Joint Life Insurance: We insure two lives, the insured debtor’s and the joint debtor’s. Joint Debtors can only be spouses or
      business partners who are jointly and severally liable for repayment of a single indebtedness by reason of having jointly
      signed the contract of indebtedness. Only one death benefit will be paid. The death of either Insured will end the insurance
      on the other. If they die at the same time, the benefits will be paid for the first insured debtor only.
      Level Term Life Benefit: The benefit is the Initial Amount of Insurance shown in the Schedule.
      Decreasing Term Life Benefit: The benefit is the Initial Amount of Insurance shown in the Schedule until the first payment
      due date. Then it reduces on each scheduled payment date by the amount of the Insurance Reduction.
      Net Balance Decreasing Term Life: Except as limited herein, the amount of insurance in force on the insured debtor for the
      first month beginning with the Effective Date of Insurance shall be the Initial Amount of Insurance shown above. Thereafter,
      the insurance in force at any time during the term of insurance shall be equal to the scheduled unpaid balance of
      indebtedness plus one month’s interest; provided, however if the Initial Amount of Insurance is less than the Total Amount
      Financed, the insurance in force at any time during the term of insurance shall be equal to the then scheduled unpaid
      balance plus one month’s interest of the Total Financed times the ratio of the Initial Amount of Insurance to the Total
      Amount Financed.
      Suicide Exclusion: No benefit will be paid if an insured commits suicide: (a) while sane or insane; (b) within two years of the
      date of issue. We will refund all premiums paid.

                                                    TOTAL DISABILITY INSURANCE
      In accordance with and subject to the provisions and conditions set forth hereafter, we will pay the monthly benefit to the
      beneficiary: 1. when we receive proof that the insured: a. became disabled while insured; b. has been disabled for at least the
      waiting period shown in the Schedule; and c. has received routine health care; and 2. while the insured remains disabled.
      Amount of Insurance: The monthly benefit is that amount shown in the Schedule. It is determined by dividing the Disability
      Initial Amount of Insurance, shown in the Schedule, by the Term of months of the indebtedness. It is the amount we will pay
      for each 30 consecutive days of disability. For each day of disability, the benefit will be 1/30th of the monthly benefit. The
      benefit will be computed from: 1. the first day of disability for retroactive insurance; or 2. the end of the waiting period,
      shown in the Schedule for nonretroactive insurance.

                                Single or Joint Decreasing or Level Term Credit Life Insurance
                                                Total Disability Credit Insurance
                                   Nonparticipating – This Policy Does Not Pay Dividends
                                               Single Premium – Nonconvertible
      10845-AHQ(93)-TX(3.53)-1-E                                                                                                                       Stock #CS117-1203

                                                                                    INSURED’S COPY
Exclusions: No benefits will be paid for disability caused by: 1. intentionally self-inflicted injury; 2. normal pregnancy or
childbirth; or 3. preexisting illness (See Definitions).
Definitions:
“Disabled” or “disability,” during the first twelve consecutive months of disability, means the insured is unable to perform
the essential and customary duties of his occupation at the time of the disability. After the first twelve consecutive months of
disability, disability means the insured is unable to perform the regular duties of any occupation that he is reasonably
qualified for by education, training, or experience.
Disability shall be computed from the first visit of the physician.
“Preexisting illness” means a disease, illness, or physical condition: 1. which within 6 months before the effective date
required the insured to receive health care; and 2. which caused disability within 6 months after the effective date.
Disability from a preexisting illness commencing or recommencing 6 months after the effective date will be covered.
Written Notice and Proof of loss: Written Notice of Loss must be given to us within thirty days after the loss occurs.
Notice given by or in behalf of The Debtor to us at our Home Office or to any of our authorized agents, with particulars
sufficient to identify the debtor, shall be deemed to be notice to us. Upon receipt of such notice, we will furnish to the
debtor, or to the Creditor for delivery to the debtor, forms for filing proofs of loss. If the debtor does not receive such
forms within fifteen days after the receipt of such notice, the debtor shall be deemed to have complied with the
requirement of the policy as to proof of loss upon submitting, within the term fixed in the policy as to proofs of loss
written proof covering the occurrence, character, and extent of the loss for which claim is made. All death claims will be
paid no later than two months after receipt of due proof and the right of the claimant to the proceeds. Disability claims will
be paid immediately upon proof of loss. Only misstatement of age can be used as a basis for reduction, termination, or
denial of a claim. Written proof of loss must be furnished to us at our Home Office within ninety days after the date for
which claim is made.
Failure to give such timely notice of proof shall not invalidate any claim if it shall be shown that such notice and proof were
given as soon as was reasonably possible.
Legal Action: No legal action may be brought by the insured to recover on this insurance within 60 days after written
proof of disability has been given. No such action may be taken after 3 years from the time proof of disability is given.

                                                    GENERAL PROVISIONS
General Definitions:
“Insured” means: 1. For Single Life and Total Disability – the insured debtor; or 2. For Joint Life – the insured debtor and
the joint debtor. If the debt arises under a lease, “Insured” includes “Lessee.”
“Creditor” means: the Creditor beneficiary. If the Debt arises under a lease, “Creditor” includes “Lessor.”
“We,” “us,” and “our” refer to American Bankers Life Assurance Company of Florida.
Consideration: The insured is afforded the insurance: 1. that is checked in the Schedule; and 2. if the premium has been
paid.
Beneficiary: The benefits will be paid to the creditor to pay off or reduce an insured’s debt. If the benefits are more than
the unpaid balance, the excess will be paid by separate Company check or draft of the insurer to: 1. for disability benefits,
the insured, if living; or 2. the second beneficiary named by an insured, if any; or 3. The insured’s estate.
Eligibility age limits: To be eligible for this insurance, the insured must, on the effective date: 1. be indebted to the
creditor; and 2. with respect to life insurance, not have reached His 66th birthday; and 3. with respect to total disability
insurance, not have reached his 66th birthday.
Misstatement of age: Our liability is limited to a refund of all premiums when the insured: 1. misstated his age; 2. on the
effective date has reached the maximum age. If coverage is inadvertently issued to a debtor who correctly stated his age and
is not eligible, we have the right, within 90 days of the effective date of coverage, to terminate the coverage and refund the
premium, provided the termination and appropriate refund have been made prior to the incurred date of a claim;
otherwise the coverage remains in full force.
Incontestability: We will not contest this insurance, after it has been in force for two years from the date of issue. All
statements made by the insured are deemed to be representations, not warranties. No material misstatement made by the
insured in the application for the policy during the contestable period, unless the misstatement is contained in a written
statement signed by the insured, and a copy of the statement is furnished to the insured or to His beneficiary. Fraudulent
misstatements regarding credit disability coverage may be contested without regard to the two year limitation.
Term of insurance: The term of this insurance shall begin on the effective date. The term shall end, without prejudice to
any claim which occurred prior to such termination, on the sooner of the: 1. scheduled maturity date of the debt; or 2.
expiration date shown in the Schedule; or 3. end of the maximum term shown in the Schedule; or 4. date the debt is
repaid, renewed, or refinanced. In case of termination of life insurance by death of an insured, the life insurance premium
paid or then due and payable to the Company is earned, and no refund is required. In such instance, disability insurance
premium is unearned and shall be refunded.
Refunds: Upon termination of either the insurance or the debt, any unearned premium: 1. will be paid or credited
promptly to the insured; and 2. will be computed by: a. for decreasing term life – the “Rule of 78s”; or b. for level term life
– the “pro rata” rule; or c. net balance decreasing term life – the “Rule of Anticipation”; or d. for total disability – the mean
between “Rule of 78s” and “pro rata” or the “Rule of Anticipation.” No charge will be made for the first 15 days of a loan
month. For 16 days or more, a full month will be charged. No refund or credit shall be made if the amount is less than one
dollar. In the event coverage is issued in excess of the limits indicated for the policy, we have the right within 90 days of the
effective date of coverage, to reduce the excess coverage and refund the charge for the excess insurance, provided the
adjustment and refund is made prior to the incurred date of a claim; otherwise the coverage remains in force as originally
issued.
Entire contract: The entire contract consists of the: 1. policy; and 2. insured’s schedule/application.
Modification of contract: No agent can change this policy or alter its terms. Changes can be made only by written
endorsement signed by our president or secretary.
Conformity with state statutes: This policy, on its effective date, is amended to comply with the statutes of the
jurisdiction where it is issued.
Physical Examination and Autopsy: We, at our expense, will have the right and opportunity to have you examined when
and as often as may reasonably be required while Your claim is in progress and to make an autopsy in case of death were it
is not forbidden by law.




10845-AHQ(93)-TX(3.53)-1-E                                                                                         Stock #CS117-1203
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