Loan Protection Insurance – Best Option for your Future.
Ever heard of Loan protection insurance? Like medical insurances, which protect you from unforeseen health calamities, Loan protection insurance protects you from eventualities which prevent you from clearing your loans. You may not be in a position to clear your loans when you meet with a crippling accident or when you lose your job. During such unfortunate eventualities loan insurance takes care of your monthly loan payments.
Types of loan Insurance:
- First Home Loan Insurance
- Car loan Insurance
- FHA Loan Insurance
- Equity Loan Insurance
- Personal Loan Insurance
- Mortgage Loan Insurance
You can go for loan protection insurance when you take a home loan or car loans. Under a loan insurance cover, the lump sum amount reduces as the outstanding loan decreases as per the loan schedule. Also read about how to get a free credit report
If you seek a loan jointly, you can go for a joint loan insurance plan. Such insurance will effectively cover you and your spouse. If either of you meet with an unfortunate accident or job loss your repayments will be made for you.
Like other insurances you must pay premium for loan protection insurance. The premium amounts usually vary and depend on the bank and other factors. The other factors include the age of the person taking the loan – usually higher for older people, the total amount of loan – lesser the loan amount, lower the premium payment as it entails lesser liability, the tenure of the loan – higher period of loan means higher premium, and the medical record of the individual – if the individual has no chronic or serious ailment, the premium amount comes down.
Things to keep While Choosing Loan Insurance Protection Plan.
- Be cautious when you choose your loan protection insurance plan. Sometimes agent can misguide you or does not like to explain the full terms and condition in order to earn commission.
- Find out more about the insurance. Research your plan, company profile before taking the final decision.
- Ask your agent what aspects of insolvency the loan insurance covers?
- Does it include temporary disability?
- Also does the insurance require a medical check-up?
- What about the tax benefits? Does your plan cover any tax benefits.
- And should the premium be paid as a lump sum amount or as part of the loan installments.