Safeguard your harvest with Land Bank’s credit life insurance

Secure your family’s future with credit life insurance from Land Bank Life Insurance Company (LBLIC). Achieve financial peace of mind for your farming loans and guarantee a debt-free inheritance for your loved ones.

Farmers, have you ever wondered what happens to your farm debt in the unfortunate event of your death, if you become disabled, or face a serious illness? It is important to have a plan in place to protect your family and ensure your loan does not become a burden in tough times. This is where Land Bank’s latest offering can come in handy.

Land Bank Life Insurance Company (LBLIC), a subsidiary of Land Bank Insurance Company (LBIC), provides credit life insurance to safeguard the well-being of your family and provide financial peace of mind when you take out large loans for farming.

According to the managing director of LBIC, Pascal Siphugu, credit life insurance is a great way to make sure that if something happens, there is a safety net for farmers and their families during challenging circumstances.

“Credit insurance policies are typically a requirement for funders when they grant loans but also very important for the farmer to mitigate against health risks and the dire consequences of leaving the family with a burden of debt from funders,” he says.

“The policy settles any outstanding debt with financiers in full in the unfortunate event of death or disability of the farmer.”

While this is an optional coverage, it is highly recommended for farmers.

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Debts covered and requirements

The debt covered is an agricultural loan taken out by a farmer to fund his or her farming activities while also meeting the credit provider’s risk criteria. LBLIC’s credit life insurance complies with the credit life insurance regulations of 2017. But what are the requirements?

There are certain requirements for obtaining credit life insurance from LBLIC. The requirements include details such as the insured’s age, the amount of coverage, and completion of a medical declaration form by the insured.

“If necessary, a completion of medical assessments as per the insured’s underwriting requirements,” says Siphugu.

Although most people like to avoid the matter, it is unavoidable that certain members of your family may survive you, and what greater legacy to leave them than a debt-free inheritance?

Furthermore, LBLIC can provide farmers with a credit life insurance policy with a flat term or a declining term. This statement means that LBLIC offers flexibility in the types of credit life insurance policies it provides to farmers.

Specifically, farmers can choose between a “flat term” or a “declining term” policy. In simple terms, farmers can choose between a flat term policy with a consistent coverage amount over time or a declining term policy where the coverage decreases gradually as the loan is paid off.

What happens when there’s non-payment?

Siphugu cautions that some farmers may underestimate the importance of credit life insurance and be tempted to skip out on payments when times are tough. However, non-payment, he says holds dire consequences for the farmer.

“The policy lapses after the non-payment of two consecutive premium payments. Policies reinstated within two months will have no conditions applicable; however, policies reinstated more than two months have the following conditions such as; exclusion of suicide for 24 months and exclusion of claims from existing medical conditions for 24 months,” he explains.

Siphugu adds that credit life insurance is a vital part of the farmer’s financial planning.