Personal, home or car loan is a big decision in the life of a common man. The higher the loan amount, the bigger the installment deduction from the salary. If the earning member of the household, in whose name the home loan is held, dies due to some reason, the loan becomes a problem for the family.
From running the family to the installment of the house, the burden falls on other members. To save the family from this trouble, it is prudent to get insurance on the loan. This insurance is given under the loan protection scheme. Through this, after you, the family will not have the tension of paying the outstanding amount of the loan.
What is the scheme: Loan protection scheme is like a term insurance. In this, your premium is decided according to the term and amount of insurance. If the person taking the loan dies, then the dues are paid through this insurance. If you remain safe for the entire tenure of the loan, then the sum insured is not available. At the same time, if you have not opted for insurance, then after you the bank will recover the remaining amount from the family. If you have kept any guarantee for the loan, then the bank can also encash it.
How to get insurance: From whichever bank you take a personal, home or car loan, they themselves will give information about the protection cover. Its lump sum amount will be given by the bank and is deducted from the installment every month. It is not necessary that you also take an insurance cover from the same bank from which you have taken the home loan. You can take this decision at your discretion. That is to say, it is not mandatory in any way.
