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Credit Card Repayment Protection Insurance

Whatever you use your credit card for, you could enjoy it more knowing that your repayment obligations could be protected.

However, it’s important that you read the terms and conditions to understand your insurance, so you know what you’re covered for in every situation.

Payment protection insurance is insurance for your credit card that can help you make your repayments when you can't work.Whether you want to buy credit card payment insurance is your choice, and it is not an obligation when applying for a credit card. Usually this service is included in credit card packages.

Credit card payment protection insurance can you help you:

  • Cover your credit card repayments in the case you lose your job, or are unfit for work due to health issues
  • Pay your card balance up to a certain amount as defined by the credit card company if you die
  • Available to you if you hold an eligible card

What is payment protection insurance?

It is a type of insurance to help you cover your credit card repayments if something unexpected happens and you can't make them. This includes losing your job or becoming unfit for work. It also helps pay the balance owing if you die. Getting credit card repayment insurance will give you one less thing to worry about because if you find it difficult to pay back your credit card obligations, then it can ease any financial burden to you and your family.

How does payment protection insurance work?

This depends entirely on the insurer, but you can expect a waiting period after you lodge your claim. Usually the insurer can pay up to double the minimum repayment until you are fit to return to work.

How much does payment protection insurance cost?

Different insurers will have different premiums and rates, please read the Product Disclosure Statement (PDS) for all the costs. As an example, HSBC's payment protection premiums are listed below. The premium is 69c per $100 on the closing balance. If you have $500 at the time, you will pay $3.45 for that month.

Closing balance at the end of the statement periodMonthly Premium
$0$0
$100$0.69
$800$5.52 ($0.69 x 8)
$1500$10.35 ($0.69 x 15)

As a second example, Westpac credit card payment protection costs 52 cents for every $100 owing on your card. The monthly premium is dependent on the balance owing on your credit card at the end of the monthly cycle.

Closing balance at the end of the statement periodMonthly Premium
>$0$0
$1000.52
$800$4.16 ($0.52 x 8)
$1500$7.80 ($0.52 x 15)

By calculating the potential cost of having payment protection insurance, you can determine whether this feature will be useful or not. If having peace of mind is worth the premiums you pay, then it may be a good idea to get payment protection.

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What is covered under the payment protection insurance?

Again, each insurer will cover you for a different amount depending on the claims you make. Generally, the amount will be calculated on the balance you owe at the time and what type of claim you made. Most insurers will pay up to $50,000 if the cardholder dies. Here is what you can expect to be covered for:

  • Life events
  • Death of a partner or spouse
  • Redundancy/resignation
  • Disablement benefit
  • Accident death

Eligibility

This is also dependent on the insurer and their policies. However, as a general guide you need to be

  • Over 18 and under 65 years of age
  • Be employed on a part-time or full-time basis.
  • You may also need to be a permanent resident of Australia or hold a valid temporary visa, as well as have no default on your credit history.
    Each policy will outline what employment status they require for you to be eligible for this insurance.
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How do I apply for payment protection insurance?

There a few ways you can apply for payment protection insurance:

  • Call your credit card provider
  • Download an application form, available from your credit card provider's website
  • When you apply for a credit card, this is one of the extra features that you can choose to include

Credit card providers with payment protection insurance

Rates last updated August 18th, 2017
Name Product Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee Product Description
ANZ Platinum Credit Card - Exclusive Offer
0% p.a. for 3 months (reverts to 19.74% p.a.)
0% p.a. for 12 months
$0 p.a. annual fee for the first year ($87 p.a. thereafter)
Exclusive to finder, receive 0% p.a. interest on purchases for 3 months and 0% p.a. on balance transfers for 12 months with no balance transfer fee.
Emirates Citi World Mastercard
20.99% p.a.
0% p.a. for 9 months
$149 p.a. annual fee for the first year ($299 p.a. thereafter)
Earn up to 1.5 Skywards Miles for every $1 spent and indulge in carefully curated local and global experiences.
St.George Vertigo Visa
13.24% p.a.
0% p.a. for 14 months
$0 p.a. annual fee for the first year ($55 p.a. thereafter)
Receive up to 55 days interest-free on purchases and the ability to make contactless payments with Visa payWave technology.
HSBC Platinum Qantas Credit Card
19.99% p.a.
0% p.a. for 6 months
$199 p.a.
Receive 60,000 bonus Qantas Points when you meet the spend requirement and earn up to 1 Qantas Point per $1 spent.
American Express Essential®  Credit Card
14.99% p.a.
0% p.a. for 12 months with 1% balance transfer fee
$0 p.a.
Receive a $50 credit when you apply online, are approved and spend $750 on your new card within the first 3 months of card membership.
HSBC Platinum Credit Card
19.99% p.a.
0% p.a. for 22 months with 2% balance transfer fee
$99 p.a.
HSBC Credit Card repayment insurance is an optional extra available on HSBC credit cards that provides easy, low cost insurance cover.
NAB Premium Card - Exclusive Offer
19.74% p.a.
0% p.a. for 24 months
$90 p.a.
Exclusive to finder.com.au, enjoy a no BT fee, long-term balance transfer offer with platinum privileges, including travel insurance.
Citi Clear Platinum
14.99% p.a.
$99 p.a.
CardProtect from Citibank can assist with account repayments when you experience unexpected circumstances
St.George Amplify Signature
19.49% p.a.
$279 p.a.
Earn up to 3 Amplify Rewards Points per $1 spent and receive two complimentary airport lounge passes per year.
NAB flybuys Rewards Card
19.99% p.a.
0% p.a. for 6 months
$95 p.a.
Earn 1 flybuys point per $1 spent on everyday purchases and receive 7 complimentary insurance covers.
NAB Velocity Rewards Premium Card
19.99% p.a.
0% p.a. for 6 months
$150 p.a.
Offers up to 1 Velocity point per $1 on purchases, combined with complimentary insurance covers and a concierge service.
American Express Platinum Card
$1,200 p.a.
Receive an annual $300 Platinum Travel Credit, membership to an elite tier of partner programs and access to more than 1,000 VIP lounges.
ANZ Low Rate
12.49% p.a.
0% p.a. for 16 months with 2% balance transfer fee
$58 p.a.
Receive up to 55 days interest-free on purchases, up to 3 additional cardholders at no cost and Mastercard PayPass.
28 Degrees Platinum Mastercard
21.99% p.a.
4.99% p.a. for 6 months
$0 p.a.
Designed for travel, benefit from no international transaction fees on purchases and no currency conversion fees.
Citi Simplicity Card
19.99% p.a.
0% p.a. for 6 months
$0 p.a.
Earn 10% cashback on eligible purchases (capped at $50 per month) for the first 4 months from card approval.
ANZ Platinum Credit Card
19.74% p.a.
0% p.a. for 16 months with 2% balance transfer fee
$0 p.a. annual fee for the first year ($87 p.a. thereafter)
Enjoy platinum card benefits with a 24/7 personal concierge and complimentary overseas travel and medical insurance.

Compare up to 4 providers

Shirley Liu

Shirley is finder.com.au's publisher for banking and investments. She has completed a Masters in Commerce (Finance) and is the author of hundreds of articles. She is passionate about helping Aussies make an informed decision, save money and find the best deal for their needs.

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2 Responses

  1. Default Gravatar
    jillMarch 11, 2015

    I have been a carer for my husband for about eighteen months and don’t get any payments for this or work at all but have insurance on my credit card how can I start making payments on this card

    • Staff
      JonathanMarch 11, 2015Staff

      Hi Jill, thanks for your inquiry!

      To allow me to assist you further could you please inform us to which credit card you are using?
      Credit card repayments can usually be made by visiting a local branch, BPAY, cheque or phone.

      Cheers,

      Jonathan

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