Objective

This policy aims to insure against the liability of a home loan, in case the borrower dies during the loan repayment tenure.
The sum assured chosen at the beginning of the tenure will decrease each year as the outstanding loan gets repaid.

What does it do?

The policy allows you to choose a sum assured and policy term depending on the loan amount and tenure. You can also choose the interest rate suitable to you in the range of 5 and 20 per cent.
This takes away the loan repayment burden from the dependents of the insured, in case of policyholder's untimely death.
The plan is available as both, individual and joint life cover. A joint life policy will pay the death benefit on death of each insured life.
In case of the first policyholder's death, the policy will pay the death benefit and continue to cover the surviving life at a reduced premium. The reduction in premium will depend on the age, gender, remaining policy term and sum assured.

Pros

This is a simple policy for those looking to cover the liability of a home loan.
There is a premium discount on policies with sum assured of Rs 5 lakh and more.
Policies purchased online get additional 5 per cent premium discount.
Premium payment frequency can be changed at any policy anniversary.
Premiums can be paid in advance and avail a discount. The discount rates are declared for each financial year.

Cons

The policy does not factor-in changes in interest rates, which affect home loans taken on floating rates.

Suited for

This policy is designed to suit borrowers looking to protect dependents from the liability of loan repayment.

Our View

A home loan insurance cover is convenient and desired. However, the policyholder is allowed to fix the interest rate and tenure while taking the policy. The policy is unable to address the need for changing interest rates that home loans are exposed to.

Eligibility

Entry Age (years)

Minimum

18

Maximum

60

Maximum Maturity Age (years)

65

Policy Term (years)

Minimum

5

Maximum

25

Sum Assured (Rs)

Minimum

300000

Maximum

No limit

Minimum Premium (Rs)

Yearly

1500

Half-Yearly

750

Quarterly

400

Monthly

150

Premium Payment Frequency

Yearly, Half-Yearly, Quarterly, Monthly

Premium Payment Term

Limited (2/3rd of policy term)

Premium Factor (multiply with annual premium)

Semi Annually: 0.51
Quarterly: 0.26
Monthly: 0.09

Policy Cover

Cover remains fixed throughout the policy tenure

Other Features

Free Look Cancellation

In case, you are not satisfied, you may choose to cancel the policy within 15 days of receiving the policy documents. Upon such cancellation, you will be paid back the premiums, minus the cost of stamp duty, medical reports and proportionate premium for the period for which the risk was covered.

Grace Period

You are allowed to pay premiums within 30 days from the due date for Yearly, Half yearly and quarterly premium payment modes and 15 days in case of monthly premium payment mode.. If a due premium is not received within the grace period, your policy will lapse and the life insurance cover will be terminated.

Lapsed Policy Reinstatement

You can reinstate your lapsed policy any time (within 2 years from the due date of the first unpaid premium) by paying all the due premiums with interest and undergoing underwriting requirements, if any.

Tax Benefits

Section 80C, 10(10D) of the Income Tax Act, 1961 would apply.

Exclusions

In case of death by suicide during the first policy year, or within one year from the date of reinstatement, no death benefit is payable.

Surrender Value

There is no surrender benefit. However, in case of advance premium payment, on death or surrender, discounted advance premiums paid but not yet due will be refunded without any interest.

Customer Service

Address

Bajaj Allianz Life Insurance Company Limited,
G.E. Plaza, Airport Road, Yerawada, Pune - 411 006.