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What is PPI, LPI or CCI?

(Payment Protection Insurance, Loan Protection Insurance & Credit Contract Indemnity)

These products all have a great deal of similarity and generally provide you with similar protection, however you should familiarise yourself with each policy in detail, to fully understand what you are covered for when purchasing each.


Who should consider these types of protection?

Anyone purchasing a vehicle and borrowing money to do so.


When you take a loan for a vehicle you are expected to make regular repayments back to the financier in order to pay off the loan (and any interest and fees) in the timeframe designated. PPI, LPI and CCI are types of insurances designed to continue making those repayments for you, when (under certain circumstances) you might not be able to.

The options are typically specific to the policyholder’s source of income at the time of purchasing and entering into a loan (otherwise known as a Credit Contract), and the benefits are generally payable directly to the financier.

In the unfortunate event of death, this type of protection usually also covers any outstanding balance on the loan.

In addition to peace of mind, having these types of insurance also can protect your credit rating, reduce the risk of your car being repossessed and protect you and your family from financial hardship when the unexpected happens.

You can choose cover for unforeseen events ranging from death through to accidents, illness, disablement, redundancy or bankruptcy. Generally there are 3 types of insurance levels, so it’s a matter of choosing the cover that's right for you.

  1. Death, Disablement, Redundancy & Bankruptcy
  2. Death & Disablement
  3. Death only

The main risk with having finance is if something happens to your ability to earn money. These types of insurances can protect you, your family and your credit rating if the worst happens.


Something to consider: ACC only pays to a maximum of 80% of your income – How might this affect your ability to repay your loan, if you had to take an instant 20% pay cut?

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