Is it mandatory to take home loan insurance if I already have a term insurance?

POSTED BY ankurj ON September 17, 2013 4:03 pm COMMENTS (6)

I am planning to avail a SBI Max gain home loan of 60 lacs. I already have a term insurance of 1cr from HDFC .

Do I need to still take home insurance or a home loan insurance?

Kindly advise.

6 replies on this article “Is it mandatory to take home loan insurance if I already have a term insurance?”

  1. ankurj says:

    Thanks everybody for your response.

    I checked with SBI. They are fine with my term insurance, regarding property insurance they said that it will be needed after I get the possession, till then it’s the responsibility of developer.

    Thanks!

  2. Sachin W says:

    Hi Ankur,

    The property insurance is mandatory with Max Gain, however the term plan offered by SBI is not mandatory and you can avoid buying it by talking to the branch manager. Property insurance will only start after you take possession of your flat. Once you have provided bank with final demand letter and your full disbursement is made, the bank deposits the property insurance cheque given by you. They will inform you before depositing the cheque.
    This is what has happened in my case.

    Thanks,
    Sachin

  3. ashalanshu says:

    Dear Ankur, Term insurance has nothing to do with your property insurance. Regarding under construction thing, if your builder do have an insurance for whole project, you may discuss the issue with the bank.

    Thanks

    Ashal

  4. ankurj says:

    @Manish: Thanks. I understand that they CANNOT force us to buy their own insurance but they CAN force us to buy an insurance which may be from some other company. My point was regarding , do I need to purchase a home insurance even if I have a term insurance with me.

    Also some feedback reg your website:
    1) JagoInvestor is slowly becoming a Google of personal finance for me and I keeps visiting here through your RSS feed.
    It looks like you have tried optimizing your site for mobile but for some reason the usability goes for a toss on my iPad. I normally use my iPad for reading purposes but reading articles from your site on iPad becomes very challenging. Moreover the option to switch to desktop site doesn’t work.
    2) Your emails are landing in my Gmail spam folder. Please look into your DKIM signatures.

    @Ashal: Thanks. I will check with them. As I understand from your another answer, it looks like it is mandatory to go for a property insurance even if I have a term insurance with me but I was wondering how does the property insurance work in the case of under-construction properties since technically the property is not mine yet till it gets registered in my name. Any liability arising out of fire, earthquake etc should be borne by the builder ( and his insurers) during the construction phase.

  5. ashalanshu says:

    Dear Ankur, please talk to your RACPC AGM of home loan incharge & ask for the waiver of life insurance as you are already having cover more than the loan amount. You ‘ll get what you are asking for.

    thanks

    Ashal

  6. Taking a Home loan insurance can not be MANDATORY . But home insurance (general insurance) might be required by some home loan companies. As far as I know, ICICI and HDFC does not have any compulsion .

    You should read this – https://www.jagoinvestor.com/2012/12/forced-selling-with-home-loan.html

    Manish

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