SBI Home Loan Linked With SBI Insurance

POSTED BY ON March 15, 2012 9:18 pm COMMENTS (30)


I recently planned to buy a home. So, after market research I approached SBI bank. But the manager informed by saying that ‘I need to take SBI Insurance along with home loan’ else will not sanction SBI home loan. Please let me know whether is it the case with SBI home loans?


30 replies on this article “SBI Home Loan Linked With SBI Insurance”

  1. ranjeet sahu says:

    i had book a flat. for home loan i had applied with DHFL.

    Loan get sanctioned amount 59 lakhs including insurance.

    i have applied for only 49lakh. but they sanctioned 59 approx. with insurance. and monthly EMI becomes 70K. its big EMI

    i told them i dont want insurance they said no u have to take tis insurance. without insurance will not give loan.

    please suggest what should i do. now. still i am waiting for respond from DHFL .

    1. Its a clear case of cheating . I suggest you reach out to RBI on this .

  2. Andrew says:

    I asked SBI for apersonal loan for 4 lakhs, after all papers have been signed they tell me to take a SBI INSURANCE FOR 25,OOO RS PER YEAR FOR 5 YEARS ,, IS TAT HOW IT IS? IS IT REFUNDABLE

    1. Its a misselling practice

  3. Naair says:

    My home loan from SBI sanctioned after lot of verifications from not than five different representatives asking for different documents after 30 days and not 10 days they promise. If I question something which was wrong on his side he was advising me don’t take loan. So shrude he was. I didn’t want to complain because he just started his career with full of tactics, wherein I am on the verge of retirement. Yesterday I was called by the bank to sign the papers, inspite of knowing and having knowledge not to sign blindly on papers without going through, I signed a bunch of papers placed before me due to lack of time. Now they are demanding three signed blank cheques one for property insurance and the other two for security. I downloaded from Makaan. Com about property insurance wherein it is stated that’s it’s not compulsory but the bank people insisted that it’s note their site. Kindly advise.

    1. SBI has this compulsion on the property insurance, but if its a home loan insurance, then you should not go for it !

  4. Sid says:

    I had applied for SBI home loan in April’16 but havent yet asked them to disburse any amount. Now i got an email saying i have to buy property insurance from them or they will auto-debit my loan account.

    1. I have only 5000 in the loan account
    2. Property is under construction
    3. I had no clue whether i have agreed to buy property insurance from them(they are saying the loan policy docs that i have signed say that i will insure the property).

    Is this compulsory? Given that they havent disbursed any loan amount, how can they ask me to insure the property? That too an under-construction one?

  5. Zoheb says:

    Hi Jagoinvestor,

    I have recently applied for a home loan with PNBHFL and got a reference number. And I am sure that they will also try to sell insurance as a bundle. Can i take a preventive action before loan gets approved, like can i write to the relationship manager stating not to try and sell any insurance plan.

    Please advise.

    Best Regards,

  6. KetanShrivastava says:

    I had taken a loan of 18 lakh from sbi.They told me that SBI Life krinn raksha is mandatory and Without my knowledge Give me policy of 211000 and not only policy of amount but gave a loan for this policy.I know about it when i got msgs from other loan account for pending of emi.Then i shocked that they gave me policy of 211000 and after that loan for it which amount 6 lacs with interest.They take my sign on agreement where in ploicy it is written if it is requested but i was not request in written for any policy even i dont know about the policy plan.what can i do.they send two sbi life insuranc policy by courier.One on my mother name that’s per year premium is 37 k something and one to me that’s premium 4900 something.I told Branch manager that it is fraud that he gave me policy without telling the specifications of product and without my writeen request then he told me I can stop policy but he had paid 41118 for first year premium so I have to pay it on emis.I am not understanding for what I should pay 41k.

    1. Hi Ketan

      You should immediately complain this to SBI grivinance first and then to banking ombudsman !

      1. ketanshrivastava says:

        Dear sir,
        I have one doubt that as I discussed with my lawyer he told me that branch manager took my sign on agreement where it is mentioned that if requested by saying it mandatory so I can ask them for my request given in written for policy but he told me that with surety he took my sign on form of sbi life insurance as you know when we have to sign on bank forms they continue ask u sign here than here and like that he took my sign on sbi life by still we can do complaint

        1. You can surely complain , but how will you prove that you didnt sign it intentionally and it was taken by you without informing you . It will be tough to prove I guess

          1. ketan says:

            yes sir same happen with many persons even I am an it guy I become fool so what can happen to persons who are illiterate or innocent villagers this branch is actually related to village. SBI is total farjiwada,Is any thing help me by complain to chairman or send mail to him. Sir is their not any act that before giving sbi life you should tell the details of product and take sign that I have read all things about product

            1. Keten

              At times there is a verification call from companies on the points you have signed. At that time you can tell them

            2. ketan says:

              I have not get any verification call sir from company ,even not on points i have signed. One person from bank come to me for verification only for address proof and he is branch managers person.Actually I was dealing directly with branch manager so I thought that I did not get call

  7. swapnil bhavsar says:

    Recently, i have opted for Home loan from Stat Bank of Hyderabad..They also added SBI life insurance with the same.

    Now after 3 months, they have added Rs. 9900/- as a Debit adjustment DD SBI Gen HL insurance. I have already paid last month installment on 6th Nov 2014 and again i got message from bank that your loan a/c xxxx irrgular by Rs. 9778/- while my installment amount is Rs. 9100/- + 400/- (Insurance) per month .

    When i visit to bank they told me that Rs. 9900/- is related to your property insurance..Please let me know if i can cancel this ? If yes, how to cancel this because they said that this is compulsory..Please provide me the contact details (email Id / contact no.) to whom i can contact to cancel this property insurance.


    Swapnil Bhavsar

  8. Pushkar Shirode says:

    I can’t stop myself from thanking Jago Investor Forum Founders & all contributors.
    At very right time I received newsletter titled:”4 things to do, when you are forced to buy a Policy with Home Loan !”.

    I am facing similar problem with SBI.Please help me with this:

    SBI initially sanctioned maximum eliglible Home Loan amount after going through my earning history & potential including all available 16F forms with me.
    But now at the time loan disbursement they are citing reason that I dont have complete two financial years 16F forms & to compensate that I need to take SBI Rinn Raksha Insurance policy without which they will not disburse loan..

    After going through above thread I come to know that it is not mandatory to avail Insurance Policy however…
    please someone help me in knowing that,is it really necessary to have full financial years 16F form at least of two years employment to get Home Loan?
    I am helpess in producing such forms because my total work experience till date is 1 year 8 months.

    Waiting for your valuable suggestions.


  9. ashish says:

    Dear Ashal.

    yes, I was referring to property insurance is compulsory.. why this is compulsary.. I dont understand.

    anyway, do u have any idea how much this cost ?


    1. Ashish

      Think from Insurer point of view . The house papers is under insurer custody and there are always a chances of default from you , so they make sure that in worst case they are in position to sell the house, so the house should be protected well . Hence

      Property Insurance is compulsory because

      – It can just vanish if there is Earthquake
      – It can be vindicated by a mob
      – It can be on fire
      – There can be something bad to house

      What happens if you are not able to pay off the loan and tell them that you surrender to the situation and also the house is not there , How will they recover, see it from the eyes of Insurer.

      And after all , it will also benefit you ,at a small cost.


      1. sudipballa says:

        Manish, If the company selling the Loan and Insurance are same, then how will it help them in case of property loss. Net Net, they will be in loss.

  10. ashish says:

    Dear friends,

    I am also having same question.. Is taking a Insurance compulsory for getting a SBI Maxgain home loan ??

    I’ve a life insurance cover for me.. which is more than loan I’m going to apply.

    MOST IMPORTANT TERMS AND CONDITIONS on SBI site mentions about this..

    Can some one tell me about this.. and generally how much this cost ?


    1. Dear Ashish, in the link shared by you, it’s clearly given that Life insurance is optional whereas property insurance is compulsory. So in your case as you already have a sufficient cover, no need to opt for life insurance from SBI. You may produce the print out of this PDF to SBI officials also.



  11. Sanjay Baldwa says:

    Its not mandatory only a option you can avail .

    SBI RINN RAKSHA is a group policy that offer with min premium to cover on loan else you can buy any term plan equal to your loan amount +20% margin as fluctuation in ROI.

  12. Abhinav Gulechha says:

    I agree with Manish here. Rather than succumbing to pressure tactics of the branch, it’s a wise ploy to tell the bank that RBI has clearly termed this practice illegal and its fun to see how things change (One of my friends recently tried this with HDFC and it helped:)…

    As far as I know, the terms and conditions of the loan agreement may contain definitive clauses on taking covers for property etc. however, the lender cannot bundle the loan with products offered by its group entities and force the customer to take it.

    For information of learned experts of the forum, even IRDA (insurance regulator) is unhappy with such practices being followed and have rolled out a discussion paper to all insurers, and we can await some directives from IRDA to curb this practice. (

  13. Vinodh

    JUst tell the manager that you mailed RBI on this and asked for this kind of rule and mentioned that a SBI manager asked for it and also ask them that your friends (we all) , told you that its a widespread way of selling the policies and you are planning to ask banking ombudsman to have a look at it .

    Also I would recommend , put a mail to this SBI manager or even customer care and put banking ombudsman , and RBI emails in CC list . I think a little threatening might work . Lets see


  14. Vinodh Kumar says:

    Hi Ashal,

    SBILIFE – Smart Performer Life Cover offered one with yearly premium of 50000.


    1. Dear Vinodh, instead of this policy, try to negotiate a term plan from SBI Life i.e. Smart Shield of at least loan amount or 50L Rs. at least. The prem. for this term cover is competitive (although not the cheapest as it’s an offline plan).
      If the branch manager does not co-operate, please file your loan application from another branch of SBI & at the same time, write a complaint to the local AGM of SBI, governing that Branch/Branch Manager.

      Do not accept the pressure tactics of that manager for your loan.



      1. Dear Vinodh, You have 2 options now with you. I think your priority for the moment is getting loan so try to get it done from different branch & in between keep working on the ways as discussed by dear Manish & dear Abhinav.



  15. Dear Vinodh, please post which policy is offered by that manager?



  16. It is not Must. Bank would try to market some of the thier products when clients visit them for some service. Let me give you example to make it more clear. You ask them for Locker, they say we have the locker but you need to go for ULIP policy, only then you will be alloted locker.

    Its all about demand and supply. If they have to meet thier target of loan, they will agree to your terms. Check with other branch. Try to negotiate and it will will work.

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