If you have a home, business or vehicle loan, the outstanding amount does not disappear if something happens to you. Loan protection insurance is designed so that the loan is settled by the insurer instead of by your family.
How it works
The policy is linked to your loan. If the insured borrower dies — and, depending on the plan, in case of disability or other covered events — the insurer pays the lender up to the sum assured. The cover usually reduces as your loan reduces.
Who should consider it
- The main earning member of a family with a large loan.
- Business owners whose loans are guaranteed personally.
- Members of cooperative banks and societies with long-tenure loans.
Questions to ask before you buy
- What events are covered? Death only, or also disability and critical illness?
- Is it single premium or regular premium? A single premium is often added to the loan amount.
- What happens if I prepay or transfer the loan? Check whether cover continues and whether any refund applies.
- Do I already have enough term insurance? A term plan may cover the loan and more.
Buying is optional
A lender may recommend loan protection, but you can choose the insurer and the type of cover that suits you. We compare options and explain the terms in plain language — and we stay with your family through the claim.
Insurance is the subject matter of solicitation. Benefits and exclusions depend on the policy issued by the insurer; read the policy document carefully.