Credit Insurance


Overview

Simply stated, credit insurance protects debt. Offered at the time a loan is initiated, credit insurance is designed to make all or a portion of the borrower's loan payment in the event of their total disability, or pay off or reduce the loan balance in the event of their death. Credit insurance is a specialized form of traditional life and disability coverage. However, certain characteristics clearly set these products apart. The most significant of these characteristics is credit insurance is tied to a specific debt obligation. CSO provides coverage through credit life insurance and credit disability insurance.

Credit Life

CSO's credit life insurance is designed to pay off or reduce the borrower’s loan balance, in the event of their death due to a covered loss. Several life coverage options are available. To learn more, click here.

Credit Disability

CSO's credit disability insurance is designed to pay the borrower’s scheduled loan payment, or a portion of it, in the event of their total disability due to a covered accident or illness. Several disability coverage options are available. To learn more, click here.

Credit Life

Credit life insurance provides a benefit designed to pay off or reduce the borrower’s loan balance, in the event of their death due to a covered event. The Irrevocable Beneficiary of a credit life insurance policy or certificate is the lender holding the loan, and is noted as the Creditor Beneficiary on the policy or certificate. If a gross pay decreasing life coverage option is purchased, any credit life proceeds remaining after the loan balance has been satisfied are paid to the Secondary Beneficiary noted on the policy or certificate, or if none is listed, to the borrower’s estate.

Credit life insurance may be available in single and joint coverage. Different coverage options may be available, including:

>

Gross Pay Decreasing Benefit

Gross Pay
Decreasing Benefit

The initial amount of credit life insurance is the total of payments on the loan, including principal, financed loan fees, insurance premiums AND interest. The coverage on Gross Pay decreases each month by the amount of the scheduled loan payment. The death benefit is the total of the remaining payments at the time of death.
The light blue section of the graph represents the principal of the note; dark blue the interest.


>

Net Pay + 2 Decreasing Benefit

Net Pay + 2
Decreasing Benefit

The initial amount of life insurance is the loan amount, including principal, financed loan fees and insurance premiums. The coverage decreases according to the original amortization of the loan. The death benefit is calculated using the original amortization to find out the original scheduled balance at the time of death. The “+2” feature is designed to cover up to 2 months of the per diem interest that continues to accrue after the covered borrower’s death.
The light blue section of the graph represents the principal of the note; white, the interest which is not protected with Net Pay + 2.


>

Truncated Net Pay +2 Decreasing Benefit

Truncated Net Pay +2
Decreasing Benefit

This coverage is similar to Net Pay +2, except it covers a term shorter than the term of the loan. The initial amount of life insurance is the loan amount up to the point of truncation, including principal, financed loan fees and insurance premiums. The coverage decreases according to the original amortization of the loan. With this type of credit life insurance, protection stops at the specified time of truncation.
The light blue section of the graph represents the principal of the note; white, the interest and portion of note amount which are not protected.


>

Level Life Benefit

Level Life (Balloon Payment/Single Payment)
Level Benefit

The initial amount of life insurance coverage is the amount of a single pay loan or the balloon payment amount as of the date of maturity. The coverage is level; it remains constant during the term of insurance. The death benefit is a flat level amount, regardless of the remaining balance on the loan.


Information provided represents a general description of credit life insurance. Refer to the policy or certificate for specific eligibility requirements, terms, conditions, limitations, exclusions, and maximum benefit limits. Credit life insurance may vary by state.

Credit Disability

Credit disability insurance provides a benefit designed to pay the borrower’s scheduled loan payment, or a portion of it, in the event of their total disability due to a covered accident or illness. The payment is processed to the lender holding the loan and is noted as the Creditor Beneficiary on the policy or certificate. Credit disability insurance is not available to insure the balloon payment on a loan.

Credit disability insurance may be available in single and joint coverage. Different coverage options may be available, including:

>

Full Term Disability

This option is designed to provide coverage for the full term of the loan. Full term credit disability insurance is designed to pay the scheduled loan payment or a portion of it, should the covered borrower(s) become totally disabled as defined in the policy or certificate.


>

Critical Period Disability

This option is designed to provide coverage for a maximum number of benefit payments for either 12, 24, or 36 months throughout the term of insurance. Once the specified total number of payments have been made, the total disability coverage ends. Critical period credit disability insurance is designed to pay the scheduled loan payment, or a portion of it, should the covered borrower(s) become totally disabled as defined in the policy or certificate.


Before benefit payments are processed, a waiting period must first be satisfied. A waiting period begins on the date of first medical treatment when the borrower is deemed unable to work due to a total disability. Waiting period options may include:

>

Retroactive Waiting Period

Under this waiting period option, credit disability benefits begin after a specified number of days (such as 14 calendar days) and then are retroactive back to the date of first medical treatment.



>

Elimination Waiting Period

Under this waiting period option, credit disability benefits begin after a specified number of days (such as 30 calendar days).



Information provided represents a general description of credit disability insurance.Refer to the policy or certificate for specific eligibility requirements, terms, conditions, limitations, exclusions, and maximum benefit limits. Credit disability insurance may vary by state.

American Heritage Life Insurance Company

American Heritage Life Insurance

CSO is proud to be the third party administrator for American Heritage Life Insurance Company (AHL). In this administrator capacity for AHL, CSO processes credit life and credit disability policies and claims underwritten by AHL. For assistance please select from the options noted below. Or at any time, please contact a CSO Representative at the toll free number noted directly above.

>

File a Claim

CSO prides itself on delivering exceptional claim service to AHL policyholders and accounts. Claim Auditors are available to personally answer incoming calls during the business hours of 7:30 am to 5:00 pm (CST ). Claim forms are available by selecting the option below. Once printed, please complete as instructed. Should you have any questions, a Claim Auditor can be reached by calling toll free 800-826-6587. A copy of the completed claim form can be faxed to CSO's claim department at 800-325-9116.

Click here to print a claim form


>

Claim Status

For information on the status of your claim, please contact CSO's claim department toll free at 800-826-6587.


>

Early Loan Payoff/Refund of Premium

For Borrowers:

Thank you for protecting your loan with credit insurance. Please refer to your policy or certificate for the benefits provided under your contract. If you wish to cancel your policy or certificate, or if you have paid off your loan early, you may be entitled to a refund of unearned premium. To receive a refund of premium, please mail us your name and current address, and if refund is due to early loan payoff, proof of payoff date to :

CSO
P.O. Box 34350
Omaha, NE 68134-0350

Should you have any questions, please contact us at 800-826-6587

For Accounts:

Select the following option to process a cancellation quote.

Click here to initiate a cancellation quote


>

Proof of Payoff Notice


Customer Service 800-826-6587 (M-F 7:30am-5:00pm Central)

Customer Service

For assistance please select from the options noted below. Or at any time, please contact a CSO Representative at the toll free number noted directly above.

>

File a Claim

CSO prides itself on delivering exceptional claim service to its policyholders and accounts. Claim Auditors are available to personally answer incoming calls during the business hours of 7:30 am to 5:00 pm (CST). Claim forms are available by selecting the option below. Once printed, please complete as instructed. Should you have any questions, a Claim Auditor can be reached by calling toll free 1-800-826-6587.

A copy of the completed claim form can be faxed to CSO's claim department at 1-800-325-9116.

Click here to print a claim form


>

Commonly Asked Claim Questions

The following provides answers to some of the commonly asked questions on a credit insurance claim.

The Central States Health & Life Co. of Omaha (CSO) credit insurance contract should be reviewed for complete information and details about any coverage, benefits, exclusions or claim questions. The answers below do not alter or modify the terms of the contract.

Credit Life Claim Questions
Credit life insurance provides a benefit designed to pay off or reduce the Borrower’s loan balance, in the event of their death due to a covered event.
The Creditor Beneficiary is the name of the lender to whom loan payments are made. Any claim benefits that are payable are paid to the Creditor Beneficiary first, as long as there is an outstanding balance on the loan. The Creditor Beneficiary is the irrevocable beneficiary, meaning that it cannot be changed. Any excess benefits that remain will be paid to the Co-Borrower if joint coverage was purchased otherwise excess benefits will be paid to the Secondary Beneficiary listed on the contract.
CSO requires an original certified death certificate and a copy of the most recent loan payment coupon/loan statement. CSO may also request an authorization form signed by the next of kin (if required). In addition, CSO will request loan pay-off information from the lender.
If CSO is in receipt of conflicting information, we may request additional documentation of the loss or to validate the Borrower’s eligibility for coverage. This information may affect or compromise the benefits. Please refer to the contract as it provides information about the Borrower’s rights and CSO’s rights.
It varies depending on how quickly CSO is in receipt of the authorization and how quickly the medical providers respond to CSO’s request. Unfortunately, a part of this process is outside of CSO’s control and depends on the medical provider and what their requirements are in order to release medical information.
It is important that all medical providers are listed on the authorization. If incomplete information is provided at the onset of the claim, it can cause delays in the claim handling.
CSO recommends keeping the loan current until CSO has all the required information necessary to make a claim determination.
The credit life insurance does not cover late payments charged by the lender. It is important to keep the loan in good standing to avoid late charges or loss of collateral.
Credit Disability Claim Questions
Credit disability insurance provides a benefit designed to pay the scheduled loan payment, or a portion of it, in the event of your total disability due to a covered sickness or injury.
The Creditor Beneficiary is the name of the lender to whom you make your loan payments. Any claim benefits that are payable are first paid to the Creditor Beneficiary to be applied to your outstanding loan balance. The Creditor Beneficiary is the irrevocable beneficiary meaning that it cannot be changed.
A Report of Disability claim form will need to be completed after you have been continuously totally disabled beyond your waiting period. CSO will mail this form to you or you can print it off our website, CSO.com. There are 4 parts that must be completed: (1) Loan Information - includes name and address of the lending institution and requires a copy of the monthly loan statement or payment coupon; (2) Insured’s Statement - completed by you and includes your signature on the Authorization to Obtain Information; (3) Employer’s Statement - must be completed by your employer (or you, if self-employed) and; (4) Attending Physician’s Statement - must be completed by your medical provider. Incomplete claim forms can delay the processing of your claim.
Your waiting period is shown on your contract. Your waiting period duration would be one of the following: 7, 14 or 30 days. There are two types of waiting periods: a retroactive waiting period or an elimination waiting period. Please refer to your contract for the definition of your type of waiting period, but these are generally defined as:
Retroactive – you have to be totally disabled for the duration of the waiting period, but benefits are paid retroactively back to the date of first medical treatment.
Elimination – you have to be totally disabled for the duration of the waiting period, benefits are paid the first day after the required waiting period is met.
If CSO is in receipt of conflicting information, CSO may request additional documentation of your loss, or to determine if your loss is impacted by a pre-existing condition, or to validate your eligibility for coverage. This information may affect or compromise your benefits. Please refer to your contract as it provides information about your rights and CSO’s rights.
It varies depending on how quickly CSO is in receipt of the authorization and how quickly your medical providers respond to CSO’s request. Unfortunately, a part of this process is outside of CSO’s control and depends on the medical provider and what their requirements are in order to release medical information.
It is important that all medical providers are listed on the claim form. If incomplete information is provided at the onset of the claim, it can cause delays in the claim handling.
CSO recommends you continue to keep your loan current until CSO has all the required information necessary to make a claim determination. CSO also recommends you contact your lender for further guidance.
Claim benefits are paid according to the date you first become totally disabled and have stopped working, as defined in your contract, and are paid every 30 days as long as you remain totally disabled and continue to submit proof of your continuing total disability. The date benefits are paid may not line up with your loan payment due date. CSO recommends you contact your lender in order to assure your account remains current. The insurance does not cover late fees charged by your lender.
Claim benefits are paid according to the dates you are actually totally disabled and after you have stopped working and your waiting period has been met. Payments are 1/30th of the available benefit for each day you remain totally disabled. If you are not working and are totally disabled for 15 days, then your benefit payment will only be for 15 days.
The first claim form is considered the initial notice of the total disability. Your contract provides CSO with the right to request ongoing verification of your total disability. Monthly claim forms are required to certify the continuing total disability and must be completed by you and your medical provider.
Sending in the claim forms early can actually delay the claim benefit. Continuing claim forms should be submitted no sooner than the date listed on your Explanation of Benefits (EOB) statement.
No, the fee charged by your medical provider is between you and your medical provider. If your condition worsens, or your disability is considered total and permanent, contact CSO about reducing the frequency of the claim forms. CSO may be able to help, depending on the circumstances.
The credit disability insurance you purchased provides benefits while you are totally disabled. It does not cover ‘partial disability’. If your medical provider released you to work light duty, then you may no longer be considered ‘totally disabled’ as defined in your contract and benefits may stop. Please refer to your contract as it provides information about your rights and CSO’s rights.
As long as there is an outstanding loan balance, claim benefits will be paid to the Creditor Beneficiary as required by your contract. If the loan was paid off prior to the Scheduled Expiration Date of the Insurance and benefits are still due for the period of total disability prior to date the loan was paid off, then payments will be made directly to you.
The Creditor Beneficiary is the name of the lender to whom you make your loan payments. Any claim benefits that are payable are paid to the Creditor Beneficiary first, as long as there is an outstanding balance on the loan. The Creditor Beneficiary is the irrevocable beneficiary meaning that it cannot be changed.
CSO accepts faxed claim forms, however, we request you also mail the original claim form to us.

>

Early Loan Payoff/Refund of Premium

For Borrowers:

Thank you for protecting your loan with credit insurance from CSO. Please refer to your policy or certificate for the benefits provided under your contract. If you wish to cancel your policy or certificate, or if you have paid off your loan early, you may be entitled to a refund of unearned premium. To receive a refund of premium, please mail us your name and current address, and if refund is due to early loan payoff, proof of payoff date to :

CSO
P.O. Box 34350
Omaha, NE 68134-0350

Should you have any questions, please contact us at 800-826-6587

For Accounts:

Select the following option to process a cancellation quote.

Click here to initiate a cancellation quote.


>

Licensing