47. Insurance purchased on the life of a borrower to provide indemnity for a loan balance if the borrower dies is referred to as
Answer: B
Credit life insurance provides indemnity for a loan balance if the borrower dies.
Credit life insurance is specifically designed to pay off a borrower's loan balance in the event of their death, ensuring that the financial obligation is met without burdening their beneficiaries.
A) bank insurance.
Bank insurance is not a recognized term in the context of life insurance specifically related to loans. It typically refers to general insurance products offered by banks, which do not specifically cover loan balances upon a borrower's death.
B) credit life insurance.
Credit life insurance is the correct term for insurance that covers the remaining balance of a loan in the event of the borrower's death. This type of insurance directly addresses the need for loan indemnity and provides peace of mind to both the lender and the borrower's beneficiaries.
C) ticket life insurance.
Ticket life insurance is not a standard term in the insurance industry and does not refer to any known insurance product. Therefore, it does not relate to the indemnity of a loan balance upon the borrower's death.
D) liability indemnity insurance.
Liability indemnity insurance covers legal liabilities rather than providing coverage for a loan balance in the event of death. It does not fulfill the specific purpose of ensuring that a loan is paid off when a borrower passes away.
Conclusion
Credit life insurance is the definitive choice for providing coverage against loan balances in the event of a borrower's death, as it is tailored for this specific purpose. All other options fail to accurately describe the type of insurance that directly addresses this need or are not recognized terms in the insurance field.