SBI Life Insurance for a Home Loan

SBI Life Insurance is one of the top life insurance companies in India. It is the result of a joint venture with one of India’s major bank, State Bank of India and BNP Paribas Cardiff, a leading global insurance company. The aim of SBI Life Insurance is to become the most trusted and preferred life insurance companies in India.

Home loan insurance can easily be taken when getting the home loan. It is usually available with the financial institution from where you are availing the home loan, and is often offered with the home loan package. While it is strongly recommended to take a home loan insurance, it must be noted that some financial institutions sell it as a mandatory part of the home loan, which is not required or necessary as per law. There are no rules and regulations which make it obligatory to purchase insurance along with loans. Hence, individuals must do their research and carefully select an insurance scheme that will suit their needs rather than the one being forcefully pushed to them.

The life insurance policies from SBI Life Insurance are generally aimed at providing financial protection and offer a wide variety of choice to suit individual circumstances. Although all the plans from SBI life insurance offer comprehensive sum assured for death and maturity benefit that can deal effectively with a home loan, the protection category offers the best option.

• SBI Life e-Shield: SBI Life e-Shield is a pure term insurance plan with affordable premium amount offering comprehensive life coverage along with additional accidental death benefits. The premium paid towards the plan can be used for claiming tax benefits. No limits on the sum assured allows an individual of any class to easily cover their respective home loan amounts.

• SBI Life Saral Shield: SBI Life Saral Shield is a low-cost term insurance plan offering flexibility in payment options. The decreasing cover benefit is ideal for a home loan which have reducing liability over the years as the loan amount is paid off. The premium of this cover will also be subsequently lower, thus making it a great choice for home loan buyers. The plan has a high sum assured and additional tax benefits on premium payments.

• SBI Life Smart Shield: SBI Life Smart Shield is an affordable term insurance plan offering different payment options. The Increasing cover feature is ideal for customers who have home loans and growing responsibilities. The increasing cover will help keep pace with growing life cover needs while keeping the premiums same for the entire term. It is a smart term insurance plan with great features and an additional applicable tax benefit. There is no limit on the life coverage amount.

Home loan protection is very important due to the unpredictable nature of life. A potential risk can be mitigated to a large extent with home loan protection. Below are some of the important reasons that justify the need for home loan protection.

• Protects the family members: If a family member who was responsible for paying the loan amount passes away suddenly, then the liability or responsibility of the entire outstanding loan amount will come on the family members. In case the family members are not in a position to generate the income to continue paying the loan EMIs, the bank will have no choice but to seize the property. If there is a home loan protection available, then this circumstance can be evaded. The family will have to put in the claim for the loan protection amount which the insurance covers. Thus, in such a scenario, despite a sudden loss of the loan bearer, the family will not lose their home. Hence, the loan protection scheme is very important if you want to shield the family in case of an eventuality.

• Protects the Asset and other Securities: In case of sudden demise of the loan bearer, the house and other assets can be seized by the bank to pay towards the outstanding loan amount. Even if the family members somehow manage to save the house, they will have to give away their valuables in the process. In such a scenario, the home loan protection scheme not only saves the house, but also saves all the valuables like jewellery which may have an emotional connection to the family members. Hence, even if the loan bearer dies, the plan ensures that the family members are able to keep the family values intact.

• Flexible options to Pay Premium: Home loan protection schemes are very much like a term insurance plan. It can be acquired by paying a single premium. If the person finds it hard to afford the one-time premium, then the premium amount can be added to the loan amount and deducted through the EMIs. For example – If the loan amount is INR 30 lakhs and the one-time insurance premium amount is INR 3 lakhs, then the loan amount will become INR 33 lakhs and the repayment can be done through EMIs. This makes it easy for the policyholder to make the payment of premium.

• Peace of mind and additional Tax benefits: Having guaranteed protection against your home will give you complete peace of mind. The home loan protection scheme is worth all the peace of mind in your daily stressful life. The premium amount paid towards the home loan protection cover can be used for tax deduction under Section 80C of the Income Tax Act, 1961.