Who is considered the insured under a credit disability policy?

In a credit disability policy, the debtor is considered the insured. This type of insurance is specifically designed to protect individuals who have taken on debt, such as a loan or credit account. When the debtor becomes disabled and is unable to make payments, the policy provides benefits that cover the loan payments directly to the creditor.

This arrangement ensures that the financial obligations of the debtor are met during a period of disability, safeguarding both the debtor’s creditworthiness and the creditor’s interests. The policy is structured in such a way that it is the debtor's disability that activates the benefits of the insurance, thereby making the debtor the party that is insured.

The other roles mentioned, such as the creditor, the debtor's beneficiary, and a third-party trustee, do not directly hold the insured status within this specific context since they are involved in different capacities regarding the loan or the disbursement of benefits. This clarity helps to establish the primary purpose and function of the credit disability policy.