What insurance benefits exist with Credit Unions?
Credit unions have taken advantage of their united strength by providing loan protection insurance cover and life insurance benefits on savings for their members through Cuna Mutual Insurance Group, which is owned by the credit union movement.
This protection is provided by Y Llechen at no extra cost to its members.
Insurance protection for your savings.
When you save with our Credit Union, your shares have the benefit of providing free life insurance. The level is subject to age (see below) and proportionate to the amount saved. The benefits are payable only on the death of a member.
Our Credit Union pays the premium for this protection out of our profits so there is no individual cost to you. This is an additional incentive to save regularly knowing that your savings bring this further benefit.
Eligibility
If you are saving with our Credit Union and you are under 70 years of age, you are eligible for this life (savings) insurance.
Benefit provided
Every £1 you save with our credit union gives a benefit of::
100% up to 65 years of age, that is every £1 of saving gains another £1 of benefit.
25% between 65-70 years, that is every £1 of saving gains another 25p of benefit
The amount of insurance benefit depends on your age when you save your money. For example, if you have savings of £100 before reaching 65 years of age and do not withdraw any, then when you reach 66 years of age, you will still enjoy the 100%. If you withdraw some of that savings at 66 years of age, the balance of your original savings would now still receive the 100% but any future savings would enjoy 25% benefit until you reached 70 years.
In other words, providing you are under 70 years of age and continue saving with your credit union then you will receive free life insurance.
Insurance protection for your Loan
Again free life insurance cover on all loans is available to our members until they reach 70 years of age. If a member dies the debt is cancelled and repaid to the credit union by the insurance cover.
This cover stops when the member reaches 70.
Pre-existing Condition Limitation (PCL)
Both the savings and loan protection insurance contracts carry a 6 months pre-existing condition limitation (PCL) as standard. Each new share (savings) deposit a member makes or each new loan agreement a member enters into is governed by the 6 month PCL.
CUNA Mutual Group will not pay benefit on a member’s outstanding share balance or loan agreement if death results from a pre-existing illness or injury for which medical advice, consultation or treatment was received within 6 months prior to making the share deposit or taking out the loan agreement.
This PCL lasts for a period of 6 months from the start date of each share deposit or loan agreement. If a member dies 6 months or more after the date of the share deposit or commencement of the loan agreement, this rule will not prevent payments.
