Home Loan Insurance - The consumer, after his premature death, does not want his family to be overwhelmed by the equity in his home. The borrower also fears that if something unexpected happens to him in the near future, the one who will repay the rest of the home loan will be refunded.

Life is unpredictable; This idea becomes more and more recurrent in the mind of the borrower since the mortgage is tied in the long term, which can go up to 30 years.
It is therefore advisable for borrowers to keep this idea in mind and plan things accordingly. However, mortgage credit insurance is not necessary if you borrow from lenders, including banks, NBFC or real estate finance companies.
According to regulators such as RBI and IRDAI, the conclusion of a household insurance is not mandatory if a borrower enters into a mortgage loan with a financial institution.

Features and benefits
You will find below the features and benefits of mortgage loan insurance:

Loan insurance offers a lump sum that can be used to repay the outstanding loan.
The policy could be invalidated in the event of transfer of the mortgage balance, its restructuring or its full repayment.
The lump sum will be paid to the beneficiary of the mortgage or to the policyholder.
Under sections 80C and 80D, the borrower benefits from the tax benefits of mortgage credit insurance.
In the case of a joint loan
With some additional bonuses, you can also cover your health insurance.
The borrower has the option to repay the premium, ie the amount of the premium or the amount of the insurance can be adjusted to the total amount of the loan and paid annually.
Borrowers have the option to convert the insurance premium into an amount that can be added to the EMI of the mortgage.
This covers certain diseases, including cancer, heart attacks and many others.
Home Credit Insurance does not cover suicide or death for a natural death.
Also read: Max Life Life Insurance Plans and Review

Insurance premium categorization
Home insurance premiums depend on one-hand categories:

The age of the insured or the borrower,
The duration of the loan
And the story of the insured or the insured person.
The home loan insurance premium also helps to prevent property. For this reason, it is essential that borrowers, in certain critical scenarios, choose this solution.

Difference between home loan insurance and housing loans
People are generally confused between home insurance and mortgage insurance. These two terms are completely different and serve different purposes.

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Home insurance, your insurance covers your home against the following risks:

Damage caused by theft of the house or property.
Damage caused by natural disasters such as earthquakes, storms, floods, fires, etc.
This means that home insurance covers the costs of replacing your home. Although mortgage loan insurance covers the loan. This plan covers only the unpaid debt at the time of his arrival.
Most days have made home insurance mandatory. Whereas mortgage loan insurance is not mandatory and is at the sole discretion of the borrower.

Types of home loan insurance
Lenders offer three types of mortgages, namely the phased plan, the hybrid plan and the plan to reduce coverage.

Cover Plan: During the life of the loan, the coverage remains the same for the insured person.
Hybrid Cover Plan: coverage remains full the first year. It starts to decrease the balance decreases with the mandate.
Coverage Reduction Plan: The current coverage and loan will decrease with the mandate.
It is obvious that a borrower can take out mortgage loan insurance if he has not yet paid the term insurance.

Temporary insurance and home loan insurance can not be compared in terms of characteristics, but have similarities between objectives and benefits.

Borrowers who have taken out a mortgage. However, mortgage loan insurance is not mandatory.

But most borrowers will think again before taking out a mortgage from a lender.

Read more about home loan insurance here www.policyplanner.com/blogs/home-loan-insurance/

Author's Bio: 

Kajal Bhagat
SEO Executive at policyplanner a web aggregator company.