Regarding Home Loan Insurance

POSTED BY Durga Prasad ON April 4, 2012 4:12 pm COMMENTS (6)

Hi sir,
Recently I have bought a ready to occupy house with the help of housing loan from housing loan finance company, HFL.

The tenure of the loan is 20 years for amount 25.5 Lakhs

I would like to insure my housing loan and I need suggestions on
1. Insurance companies providing best housing loan insurance plans
2. Tenure of the insurance and premium amount payable
3. Benefits, risk cover and other features provided by the insurance companies in this regard.
4. Any other related helpful information
Thanks in advance,
Durga

6 replies on this article “Regarding Home Loan Insurance”

  1. Dear Durga, are you asking for your life insurance to cover loan liabilities for your family in your absence or home insurance to cover loan liabilities from natural calamities or fire ….

    Please clarify.

    Thanks

    Ashal

    1. durga says:

      Ashal and Justgrowmymoney,

      Thanks for your suggestions!!!

      I am asking for life insurance to cover the loan liabilities for my family in my absence.
      Through this forum, I also realized the importance of home insurance to cover loan liabilities from natural calamities or fire.

      Ashal and Justgrowmymoney,

      Please suggest your views as well as Insurance companies offering better plans in this regard.

      Thanks,
      Durga

      1. Dear Durga, although you are asking for Mortgage Term Cover to protect your home loan but my take ‘ll be to go for a plain vanilla Term cover of a big size which ‘ll not only cover your loan liabilities but also your financial liabilities towards your family, for living expenses, children’s education, career, marriage, spouse’s retired life…………

        Thanks

        Ashal

  2. There are 2 insurances involved here:

    1) If the home loan taker is no more it puts the family at risk as the home loan may not be paid. For this you need a Term Insurance.

    2) The risk to the home itself – due to fire, natural calamities etc. also needs to be insured. Try Oriental for such plans.

  3. TheZionView says:

    Durga,

    It is better in term of risk and return to go for a Term Insurance instead of a separate Home Loan insurance. You may ask why? here are my reasons

    1. Home Loan Insurance are reducing Sum Assured insurance (Meaning as you repay loan through EMI and principal gets reduced the SA is also reduced)
    2. There are 2 options of premium paying in home loan insurance. One time premium or Premium paid by loan providing bank and charges added to your home loan itself ,which mean you pay same interest for the premium amount paid

    1. durga says:

      TheZionView,
      Thanks for your suggestions!!

      Can you elaborate the second point in your reply.

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