Credit Card Glossary: Terms and Definitions
Payment protection plan
Payment protection plans are a type of insurance plan offered by card issuers to cover circumstances such as job loss or disability. Typically, plans suspend minimum payments and halt interest accrual. Fees, based on the outstanding monthly account balance, are generally viewed as a high cost for the coverage provided. The plans were the focus of regulatory enforcement actions brought against three major card issuers in 2012.