Life Accident and Health-“Do I need this?”
This is an insurance product that is available to protect auto buying consumers in the event of sickness, injury, or death. This was a very popular product that was offered by almost all dealerships a decade ago. However, many states have clamped down on this practice. They mandated that in order to sell a life insurance product, you had to be licensed to do so. Auto dealerships are in the business of selling cars and not insurance, so it forced them to drop these types of insurance products. If they are still available at auto dealerships in your state and they are offered to you or “stuffed” in to the financing then just politely say NO! When I say “stuffed”, I am referring to the practice of presenting a product included in the payment. This is sometimes called a “fully protected payment”. This is illegal in most states due to recent disclosure laws, so be aware of this practice. There is no lending institution that requires you to carry such a policy, so do not be fooled if you are told such a lie. It is unlikely that you will be offered such a product, but in the event that you are you will be prepared.
If you want to protect yourself from such an event, then I suggest you increase your current life insurance policy. You can also check with your current employer, to see if these types of coverages are available from the insurance carriers they are using. Often times they are available at very reasonable rates, and they can be payroll deducted.