California-based Computer Sciences Corporation (CSC) has launched a new service that allows banks and other financial institutions to offer their own debt protection programmes (DPPs) to their customers, eliminating the need to contract with insurers.
The end-to-end CSC offering includes flexible planning, design and implementation, as well as full actuarial, administration and back-office support. Implemented on an application services provider (ASP) basis, the client needs no hardware, software or programming resources says the vendor.
"DPPs enable banks to offer borrowers a cushion against involuntary unemployment, disability and many other life-altering events," says Gary Fagg with Dallas-based CreditRe.
The CSC service offers processing of debt protection for automobile loans and leases, consumer lending, first mortgages, other real estate-secured loans and credit cards. Supported functions include solicitation campaigns, applications, billing and collections, payment processing, correspondence, contract settlements and cancellations.
According to the US Office of the Comptroller of the Currency, DPPs have been gaining steam since the 1999 passage of the Gramm-Leach-Bliley Act (GLBA), which modernised the US financial services industry. The GLBA excluded debt protection products from the definition of insurance, freeing them from many regulatory restrictions.