November 3rd, 2011 
Admin Question by Kim: Credit life insurance on student loans?
I am a 25-year-old interested in taking out life insurance for myself. I have a mortgage-sized student loan bill, so I am interested in credit life insurance, but I don’t know if these are for mortgages or anything financed. I haven’t found much information on credit life insurance from reputable sites. Any thoughts?
Best answer:
Answer by mbrcatz
My first thought, is that debt is NOT inheritable. So why do you want to buy insurance to protect SOMEONE ELSE? If you die, they’re screwed.
Unless, of course, your parents cosigned for the loans . . .and then if you die, they have to pay.
But if no one cosigned the loans for you, I think it’s a waste of money. It only protects the lender.
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First off you don’t need credit life insurance. If you die your debt dies with you.
Second, in spite of the fact that your debt is extinguished if you feel there is some moral obligation just buy a standard term policy for the duration of your loan. So if you think the loan will take 10 years to pay off buy a 10 year level term policy. It will be cheaper than buying a credit life policy.
If you want to secure the large student loan, the cheapest option is to take a Term-10 or Term-20 life insurance policy. Such Term policy for $ 250,000 will cost you approx. $ 20/month if you’re a Non-Smoker. Or approx. $ 35/month if you’re a Smoker.