Objective

This policy aims to repay an outstanding loan on death of the policyholder, protecting family members from a loan liability.

What does it do?

This is a simple mortgage term insurance plan that pays sum assured equal to the outstanding loan amount (as per the loan schedule) on death of the life insured. In case the loan was taken jointly, the policy covers both applicants and death benefit is paid on first death of any of the co-borrowers. The policy does not offer any surrender or maturity value.

Pros

A lapsed policy can be revived within 5 years from the date of lapse, a considerably long period as compared to other policies.
There is no maximum limit on sum assured in the plan.

Cons

The policy does not factor interest rate changes that affect loan amount during the term of the loan.

Suited for

One can take this policy to protect the family against a specific liability like a home loan.

Our View

Consider this policy if you have to repay an outstanding loan or intend to take one in future. The plan can cover loan amount as low as Rs 2 lakh without any maximum limit. However, the policy does not consider interest rate changes during the loan term, which is a limitation.

Eligibility

Entry Age (years)

Minimum

20

Maximum

55

Maximum Maturity Age (years)

65

Policy Term (years)

Minimum

Single Premium: 2; Regular Premium: 5

Maximum

30

Sum Assured (Rs)

Minimum

200000

Maximum

No limit

Minimum Premium (Rs)

Yearly

1000

Half-Yearly

700

Quarterly

450

Monthly

175

Single

2500

Premium Payment Frequency

Single, Yearly, Half-Yearly, Quarterly, Monthly(through ECS)

Premium Payment Term

Single, Limited (2/3rd of loan term)

Premium Factor (multiply with annual premium)

0.51 for Semi Annual mode, 0.26 for quarterly mode and 0.09 for monthly mode

Policy Cover

Cover remains same throughout the policy term.

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 5 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.

Customer Service

Address

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