A must for all Loan applicants
Home Loan EMI Insurance is a must for all housing loan borrowers. Taking a Home loan is not a big thing but insuring it is good to work. Many think that insurance cover for a home loan is not required. Your home purchased through a housing loan is not yours until you clear the dues.
Insuring your Home loan or any other loan EMI is very essential. God forbid something happens to the applicant, the family should not suffer. In case, any problem arises the family member has to clear the loan fully otherwise the property would be taken over by the Loan Company.
You may be taking a housing loan of Rs. 50,00,000/-, the monthly loan EMI would be approx. Rs. 44,000/- for 20 years. That means you are paying approx. Rs. 44000 x 12 = 5,28,000/- to be paid for 20 years which comes to Rs. 1,05,60,000/- An applicant is going to pay two times the loan is taken for in EMI.
Many people forget to buy insurance cover for Loan EMI. It is very risky to have a huge loan without insurance cover for the home loan with interest. Home Loan EMI Insurance is a must because your family can live in the same house even after anything happens to you.
Some Home loan companies add Insurance cover also while disbursing loan amounts. That would increase the EMI which is not good. Be careful while signing the housing loan papers. Outside, you can have more coverage for less premium with more benefits.
Home loan Insurance should be purchased separately from the best claim settlement company with all benefits. Many people stop paying for the insurance coverage once the loan is cleared. It is not good. Having life insurance coverage is always good. In case not able to pay the premium, then it is ok otherwise continue till it is required.
Insuring under Home Loan EMI Insurance is very easy and sometimes paperless. But after signing the papers, you cannot see or even get a call for collection premium in many cases. In those cases, your Home Loan EMI Insurance will lapse.
Home loan insurance is a pure term insurance plan and can be discontinued once the loan is cleared. There would be no compulsion to continue the Insurance cover after the loan is cleared. If the Policyholder wants to continue, he may continue till maturity. No Maturity amount would be payable after the premium paying term is over.
How to buy Insurance coverage for a home loan?
Proper planning has to be done for loan insurance coverage. Many things to be considered before buying the cover. Applicant’s age, loan amount, earnings, dependents, loan EMI amount, total interest to be paid, Insurance premium amount etc., has to be considered before arriving at the final insurance value.
Is it necessary to buy Home Loan Insurance?
Home Loan Insurance is not necessary if the applicant is having enough wealth to support his family in case of any eventuality. For most home loan applicants, buying a home is a big dream in life. In case of any eventuality, the other members are required to pay the Home loan with interest. In that case, Home loan insurance would be very helpful.
An experienced Advisor can help the applicant to arrive at a decent cover which would help his family also financially in case of any eventuality.
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