Credit life insurance is most commonly written as:

Credit life insurance is primarily designed to pay off a borrower's debt in the event of their death. The structure of this type of insurance typically aligns with the nature of the debt itself, which often decreases over time as payments are made. Therefore, the most common form of credit life insurance is a decreasing term policy.

In a decreasing term policy, the death benefit reduces at a predetermined rate each year, mirroring the decline in the outstanding balance of the loan or credit. This ensures that, should the insured pass away, the insurance payout is equivalent to the amount still owed on the debt. This design provides reassurance to both the lender and the borrower, as it aligns the insurance coverage with the amount of debt that exists at any given time.

Other types of life insurance, such as increasing term, whole life, and universal life, do not typically align with the goals of credit life insurance. Increasing term insurance may be structured to grow in benefit over time, which does not serve the purpose of covering a declining debt. Whole life and universal life policies are permanent forms of insurance with cash value components, which are not inherently designed to settle debts in a decreasing manner. Therefore, for credit life insurance, the decreasing term structure is the most logical and practical