IDBI Federal Loansurance Group Insurance Plan
'IDBI Federal Loansurance Group Insurance Plan' (also known as Loansurance) is a comprehensive solution that lets you to help protect your borrower's assets and savings. Loansurance is a key tool which helps to extend peace of mind to your clients. In the event of your client's unfortunate death, this tool ensures that their debt do not become a burden on their family. At the same time you will also be protected from the risk of non-payment of the loan due to death of the borrower. The persons who are directly liable for loan repayment (and the partners, in case of a partnership) will be covered with this loan.
This means that even a business entity will be protected against loan default in case of the death of the persons who are responsible for loan repayment. The benefits of Loansurance are multiple. It not only extends benefits to you but also to your customers.
Eligibility for Loansurance Group Insurance Plan:
The following eligibility criteria must be met by all individual borrowers or co-borrowers:
Parameters | Minimum | Maximum |
Group size | 50 lives | No limit |
Cover ceasing age | Not applicable | 70 years (last birthday) |
Entry age | For education loan: 15 years (last birthday) For other loans: 18 years (last birthday) | 65 years (last birthday) |
Cover term | For reducing cover option: 8 years. For level cover option: 5 years | 30 years (including moratorium period, if any) |
Sum assured | Rs. 10,000 (in respect of each member) | No limit (subject to underwriting) |
Key Features of Loansurance Group Insurance Plan:
Listed below the key features of Loansurance Group Insurance Plan:
Plan basis | Group |
Premium payment options | Loansurance offers increased flexibility through limited and regular premium payment options. |
Premium payment frequency | Monthly, quarterly, half-yearly or yearly |
Premium payment method | Pay the premium separately or increase the EMI to cover the premium. You can fund the premiums by increasing the loan amount to that extent. |
Automatic acceptance | All home loan borrowers will have automatic acceptance of risk, subject to fulfilment of certain conditions which are mentioned in the company's website. |
Discount for women | Discount on premium for female insured members |
High Sum Assured Rebate | Premium discount structure available. This applies if the sum assured purchased is Rs. 10 lakhs or above. |
Loan prepayment | If you choose to pre pay the loan, the actual loan outstanding balance will be extinguished and the cover can be cancelled. |
Grace period | The number of days you can avail as Grace Period differs according to the Premium Payment Frequency. For quarterly, half-yearly and yearly payments, the grace period is 30 days. For monthly payments, the grace period is 15 days. |
Lapse | If the borrower does not manage to pay the premium within the grace period, the cover lapses. No benefits will be payable on a lapsed cover. |
Surrender Value | A surrender value is available with respect to each insured member for limited premium payment covers. |
Free look period | 15 days |
Nomination | During the lifetime of the policyholder, a nominee must be chosen (given in writing). The benefits of the policy will be paid to the nominee in the unfortunate event of the insured's death. |
Policy discontinuance | You may discontinue the policy for new members by giving the company a prior written notice of at least three months or of a period that has been discussed with the company. |
Suicide claim provision | If the insured commits suicide within 12 months from the date of commencement of the policy or from the date of policy issue, the company will pay 80% of the premiums paid as the death benefit. |
Benefits of Loansurance Group Insurance Plan:
Listed below the main benefits of Loansurance Group Insurance Plan:
Death benefit: In the event of death of the insured during the cover term, a death benefit will be paid. This will be equal to the reducing amount as per the benefit schedule for the cover month at the time of the death.
Benefit of joint cover: It's possible for two co-borrowers of a loan to insure themselves using the joint cover option. Upon the death of either of the joint insured members, full benefit amount is paid and the cover will be terminated.
Tax Benefits: Tax Benefits are available with this IDBI Federal Life Insurance policy. However, it is subject to change in tax laws.
Premium Payment Options:
Loansurance offers increased flexibility through limited and regular premium payment options:
| Premium payment term (years) | |
Premium payment options | Reducing cover option | Level cover option |
Regular premium payment | Not available | Equal to the cover term. |
Limited premium payment | 5, 10, 2/3 of cover term (subject to a minimum of 5 years) | 5, 10 |
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