Baskadia

Life is full of uncertainties. Unexpected events can sometimes affect our ability to repay Loans. Loan Insurance, also known as Loan Protection Insurance, provides financial security if you cannot meet your Loan repayments due to certain circumstances.

What is Loan Insurance?

Loan Insurance is designed to safeguard borrowers and lenders from potential financial problems if the borrower cannot repay their Loan. This could be due to illness, disability, job loss, or death. It covers different Loans, including Personal, Mortgage, Car, and Credit Card debt. This Insurance usually offers coverage for a defined period. It assists with Loan repayments during the policy's duration under specified circumstances.

Who should opt for Loan Insurance?

Like a Health Insurance Policy, Loan Insurance can be beneficial for you in certain situations:

High Loan amounts

Loan Insurance could provide peace of mind if you have a substantial Loan amount, such as a mortgage, and are concerned about how you would manage repayments.

Single income earners

If your family depends heavily on your income and you have Loans, the Insurance can act as a safety net. It ensures that your family is not burdened with Loan repayments if something happens to you.

Self-employed individuals

If you are self-employed, you might experience irregular income streams. Loan Insurance can offer financial assurance during periods of income instability.

People with health issues

If you have pre-existing health conditions, the Insurance can cover repayments if your health situation affects your work and capability to earn an income.

Jobs with a higher risk of layoffs

If you work in an industry or have a higher job loss risk, Loan Insurance is an excellent choice.

How does Loan Insurance work?

Policy purchase: You buy a Loan Insurance Policy from an insurer. The policy's coverage duration and terms are outlined in the contract.

Premium payment: You can pay regular premiums as a lump sum or in instalments to maintain the policy. The premium amount depends on factors like the Loan amount, term, and age.

Qualifying events: If you experience an event specified in the policy (such as job loss, disability, illness, or death), you can make a claim.

Claim submission: You need to submit a claim to the insurer and the necessary documentation, such as medical reports or proof of job loss.

Claim approval: If the claim is approved and the waiting period (if applicable) has passed, the Insurance company starts covering your Loan repayments for the specified period or until you are back on your feet.

Important considerations

·         Carefully read and understand the policy terms, coverage limits, exclusions, waiting periods, and claim procedures before purchasing loan insurance.

·         Compare Loan Insurance offers from different insurers to find the best coverage and premium rates for your needs.

·         Check if you have any Insurance coverage that might overlap with the protection offered by Loan Insurance.