What Does Credit Life Insurance Cover? 
Credit life insurance just covers the debt with a particular lending institution . If you should pass away , the credit insurance policy would pay them the lender what you owed them . Regular life insurance can be used to repay debts . It is done with a collateral assignment form . If you passed away , the amount that is owed to your lender would be paid to them , and the rest is paid to the beneficiary of your choice . The premium is locked in for a number of years , but every year that you have your policy , less would go to your lender , and more would go to the beneficiary , in the event of your death . 