Is It Obligatory To Get Life Insurance While Taking A Loan?

Taking credit is a lifesaver in some difficult times of our lives. When it comes to buying a house, having a wedding, buying a car, growing things, teaching children, the justified reasons that go on and on making it obligatory to use credit.

Taking credit is not as easy as expected. Even if your credit score is good and your registry is clean, it will not decrease the required documents. Therefore, it is important that the documents are complete and the conditions are complete while taking credit.

Immediately after your credit approval, you will be told about an obligation to have taken out life insurance before switching to your credit account. The question of whether it is compulsory to take out life insurance while taking a loan for those who hear this will immediately come to mind.

Life Insurance Obligation When Taking Credits

hide table of contents Life Insurance Obligation When Taking 1 Credit 2 Why Banks Want Life Insurance? 3 Is Insurance Liability Eliminated In Loans? 4 Life Insurance Refunds When Taking Credits 5 Why is it Important to Take Life Insurance?

Life insurance, which is mentioned to you when you take out a loan and is stated as compulsory, is actually an unnecessary event when it is handled on a legal level. It is perceived as an obligation among people who take out loans because the banks reflect it as compulsory.

You have the right not to accept life insurance, which is said to be compulsory when you take out a loan. For this, it will be enough to write a petition to the bank. If it is not accepted, it is necessary to apply to the Consumer Courts.

Why Banks Want Life Insurance?


Banks try to understand whether they can get back the money they give with the documents they demand from the consumers while taking credit. Because of no matter who or which institution is the most natural right to want to take back the money that it lends. Life insurance obligation has emerged with the same logic. Life insurance is a policy that takes over if the borrower dies and protects the creditor and heirs.

Under what conditions it is activated and to what extent it protects, it depends on the conditions of the policy. Banks create a kind of protective shield for themselves with life insurance by showing it as compulsory because they do not want to lose their money in case of a situation that happens to the person they loan. Thus, another payment guarantee is created.

Is Insurance Liability Eliminated In Loans?

It is necessary to say that there is no such obligation from the very beginning for people who think that the credit obligation in banks is new. When banks give credit in accordance with the laws they are bound by, there is never any obligation to take out life insurance.

In fact, sometimes there is a chance for the consumer to complain and claim his right when an insurance cut is made without the knowledge of the consumer. For this, he must first apply to the bank and then to the consumer court.

Life Insurance Refund While Taking A Loan

Life Insurance Refund While Taking A Loan

Borrowers can request a life insurance refund from the banks when they close their loans early or when their payments are terminated. Banks are known to make unfair earnings due to the majority of people who do not know this. Only 5% of society applies to extradition.

A bank that knows that your loan will expire in February can get you annual life insurance. As a result, you will pay an extra 10 months of premium. To prevent this, you can request a refund with a petition stating that you want a refund from the bank.

Why Is It Important To Take Life Insurance?


Although banks’ attempts to make them seem obligatory are not met ethically, taking out life insurance can be preferred because it benefits both parties.

Since the bank is guaranteed its own money, although it is biased, the benefits of taking life insurance while taking credit should also be considered, since it protects the rights of the consumer when a situation occurs.

Issues such as what the policy covers or does not cover, in which cases it will benefit the consumer should be investigated and done if necessary. Since the future is unpredictable, it requires taking precautions.

About the Author