About Home Loan Insurance Plan
Other goods, such as housing loan insurance, have also gained traction with the growing penetration of home loans. The applicant is given a cover which, after the applicant’s death, does not place the burden of repayment of the loan. This system provides much-needed financial cover, emotional support, and peace of mind for the family.
A home loan insurance package is the same as a term insurance plan provided by different firms providing life insurance. But the only difference is that the amount of insurance coverage in the definition is fixed and the coverage of in-home loan insurance tends to decline with the loan’s declining liability.
Here are some popular decreasing term assurance policies to cover home loan repayment, offered by life insurance companies like Aviva LifeShield Platinum, ICICI Pru Home Assure, LIC Mortgage Redemption, Aegon Religare Decreasing Term Plan, and SBI Life Smart Shield.
You have two options, either to go directly for a single premium home loan insurance cover extended by the NBFC bank offering the loan or to purchase one of the above plans.
Banks usually raise the amount of the customer’s loan to meet the home loan insurance premium. There is, however, not much difference between both insurance options’ premiums; by making the one-time premium payment, many individuals take it along with the home loan.
The premium you need to pay depends on the borrower’s amount of credit, tenure, age, and health status. A higher-age borrower or higher loan sum means a higher premium, and the borrower’s good medical report can help to get lower premiums.
This device should be viewed as an instrument that preserves the financial position of your family and does not jeopardize their future by putting the house’s ownership at risk.
Know more about home loan eligibility.