Why do some banks ask that I assign a life insurance policy as collateral for a loan and some don't?
Different banks have different loan policies, based on their experiences. It may be your age, assets, line of work, amount borrowered and repayment terms, etc. The idea is that the lender sees risk in every loan. Some have more than others and their job is to mitigate the risk that they can, so they have an acceptable loan. Some of your lenders see life insurance as a way to mitigate the risk that if you were to pass, they may have a more difficult time getting repaid.
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Different banks have different loan policies, based on their experiences. It may be your age, assets, line of work, amount borrowered and repayment terms, etc. The idea is that the lender sees risk in every loan. Some have more than others and their job is to mitigate the risk that they can, so they have an acceptable loan. Some of your lenders see life insurance as a way to mitigate the risk that if you were to pass, they may have a more difficult time getting repaid.
