Can anyone explain the Payment Protect, their FAQ just confuses me, and I have only the vaguest of ideas about what this product is.

I can see: -
- it's a payment waiver policy, so the borrower may be excused from making repayments
- it's optional for the borrower,
- there are two levels of cover
- some or all of the repayments may be waived
- if the loan is repaid early some of the fee is rebated to the borrower

It appears, but isn't clear to me: -
- the borrower pays for the Payment Protect with the fee capitalised into their loan
- the fee varies from 7.24% to 11.66%
- Harmoney's fee is included/excluded in the above
- Harmoney's fee is deducted from the amount we lend
- if the loan is repaid early, do we get a rebate from Harmoney
- there is absolutely no guidance on the tax implications

I wish Harmoney had given some examples. So I'll try my own. If I lend $100 to a Payment Protect loan: -
- Harmoney will take $3 or $4 in fees to start with
- the loan repayments will be set so that I should get about $108 to $111 (depending on the PP fee) back over the term of the loan
- if the loan is repaid/rewritten half way through, I'll get back $104 to $105, as half the PP fee is rebated to the borrower
- if the loan is repaid/rewritten after almost immediately, I'll get back the $100 from the borrower, and they'll get back all of the PP fee, but my net return will be only $96-$97, because Harmoney have taken their $3-$4 fee from me upfront.

Questions: -
- in the above, what do I get if the borrower dies on day one, it seems to be nothing.

With the lack of clarity about this product, and with no indication of how to treat it for tax purposes, I think I'll give it a miss.