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A type of credit insurance, involuntary unemployment coverage protects borrowers against the risk of unemployment and their inability
to pay their loan installments while unemployed. The coverage is written through financial institutions at the time of making a loan to
a borrower. The premium is calculated as a percentage of the total insured loan payments, paid at the time of the loan, and amortized into
the borrower’s monthly loan installments. Coverage for co-borrowers requires additional premiums. The term of the coverage equals the
term of the borrower’s loan.
Founders’ program offers coverage up to the borrower’s monthly loan installment, not to exceed $2,500, for loans up to 72 months. To
qualify for the coverage, the borrower must have been employed for at least six consecutive months with the same employer and work a
minimum of 30 hours per week. Employment with more than one employer is acceptable. In addition, borrowers may not be self-employed,
independent contractors, members of the active military, or a controlling stockholder or dependent of a controlling stockholder of the employer.
The loss of employment must be “involuntary,” such as a permanent layoff or employer termination for reasons other than employee misconduct,
and must last more than 30 consecutive days. A layoff due to the seasonality of the employer’s business is not covered, but a layoff due to
other causes not specifically excluded is eligible for coverage. The term of the borrower’s loan determines the number of monthly installments
payable by Founders in the event of a covered loss of employment. Limited benefits apply during the first 60 days of coverage.
If you are an agent interested in distributing this product, please contact our marketing department at marketing@foundersinsurance.com
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