Your insurance can also get cheap loan, you have to apply in these 4 steps

At present, insurance companies are giving loans at the rate of 9-10 percent on loans. In banks etc., this rate can be up to 12-18 percent. In this context, the loan taken on insurance is economical and cheap. Instant loan money is also available.

You can easily take a loan against your insurance policy

What do we do when we need money all of a sudden? Either take a loan from a credit card or personal loan apply for. But we rarely pay attention to our insurance policy. The truth is that one can easily take a loan against an insurance policy, that too in a cheap and convenient manner. Where the loan taken from banks or finance companies is expensive, the loan taken on life insurance is available somewhat cheaply. If you also have any life insurance, then there is no need to think much about the loan in case of emergency. Just apply in easy steps and take loan.

The process of taking a loan against life insurance is very simple and your insurance cover will not be affected due to this loan. Let us know what is the process of taking loan against insurance.

  1. Insurance companies prepare special forms for giving loans, which you have to fill. For this, one has to go to the nearest branch of the insurance company.
  2. You can also download the form from the website of the insurance policy. Take a print out of it and fill it correctly. Policy details and loan amount have to be entered in the form.
  3. Fill this form and submit it to the nearest branch of the insurance policy. You can also take the service of an insurance agent in this work.
  4. Many companies also provide online facilities for giving loan against insurance. You can apply for the loan online by visiting the company’s portal.

how much loan will you get

Insurance companies decide the loan amount on the basis of surrender value. Usually, loan can be taken up to 90% of the surrender value of life insurance. The loan limit in a paid-up policy can be up to 85 percent. If a company gives loan against ULIP, then the loan amount depends on its fund value. All insurance companies provide loan facility. Loan facility is not available only against term insurance.

what will be the interest rate

At present, insurance companies are giving loans at the rate of 9-10 percent on loans. In banks etc., this rate can be up to 12-18 percent. In this context, the loan taken on insurance is economical and cheap. Most insurance companies calculate their rate on the basis of half yearly compound interest. Most insurance companies are giving loans at the rate of 10% and the loan has to be paid in two installments.

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How many days will get the loan

What will be the tenure of the loan, it will depend on the term of the insurance. If you have 5 years insurance then you can take a loan for 5 years. The loan has to be repaid before maturity in any case. If the loan is not repaid, the interest amount will be added to the principal amount. If the amount of loan and interest exceeds the surrender value, the policy will be terminated.

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