With the increasing phase of life, it is natural to have financial liability elevating other than family expenses, and household needs to rise. Every person wants to improve living standards, provide better facilities to family, and educate children in world-class schools and colleges. Investing your hardworking earned money in purchasing a house, moving your kids to a highly acclaimed school, and buying a luxurious vehicle can drain a large part of your earning. If you don’t have enough funds, you will look for extra resources to increase your income. One alternative is that of opting for a loan against your insurance policy. But before applying for a loan against your insurance policy, you should know the factors to decide how you can apply for the loan.
Policy type– it is notable that all policy has the advantage of taking a loan. Life insurance policy such as an endowment plan, ULIP with a paid premium for a minimum of 3 years; makes you eligible for applying for a loan. However, you cannot apply for a loan against a term insurance policy because they don’t have a surrender value. Your Life Insurance Advisor in Noida will recommend how you can get a loan against the insurance plan.
Premiums – if you have taken a loan against the policy, that doesn’t mean you are exempted from paying premiums. It is necessary to pay your premium on time, lest the insurance company lapse the life insurance policy. Contact Life Insurance Advisor in Noida Sector 18 for detailed inquiry.
Processing fees– The processing charges for loans aligned with the insurance policy are nominal. The Life Insurance Advisor in Noida Sector 37 can guide you better in this reference.
CIBIL Score – Banks will evaluate the CIBIL score of the applicant for sanctioning a loan. Make sure to maintain your CIBIL score while applying for a loan on behalf of the insurance policy. However, this loan is also the best option for individuals with a low CIBIL score.
The interest rate of the loan: The loan on behalf of insurance is appropriate for personal and unsecured loans. The interest rate on loans against insurance is significantly less than 10 to 12%.
Documentation formalities: As we know, that applicant is the existing customer, so there are the least required documentation formalities. After that, the loan amount will be sanctioned immediately.
How can I apply for a loan against insurance?
The documents needed for applying loan aligned with insurance are:
- Application form
- Deed of Assignment (which explain that the life insurance policy has been allocated to the insurer)
- Original insurance policy bond
- Recent premium payment receipt/acknowledgment
- Cancel cheque
Taking a loan on behalf of the insurance policy process based on the life insurance policy and insurer category. It is necessary to acquire complete information from the insurance agency about the important terms and conditions to apply for a loan against insurance.
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