Know Your Goal and Stay True to It
This time of year, we see many Lenders reviewing their Collateral Protection Insurance (CPI) program type. But the mistakes Lenders make is trying to fix a problem by creating another one. It is important to know your main goal with your CPI program type and stay true to it!
Is your goal to make the premium more affordable? To have the most comprehensive coverage? To have the easiest program to manage for your staff? To have the least disruption to your borrowers?
Lenders make the mistake because they want to answer 'yes' to all of these questions for all scenarios. The reality is that there are situations that will come up where a claim is denied, or premium is too expensive for the borrower, or there are operational issues with your program, etc.
When something comes up that does not achieve your goal in that specific situation, make sure to look at the whole of the program and not just that one scenario before making a change. Sometimes it is the best for the lender to make a change, other times it creates more issues than it solves.
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