What does it do?
The policy pays sum assured to the nominee in case of death of the insured. Single premium policies can be surrendered after second policy year. The policy doesn’t offer any survival benefit. Sum assured under this plan reduces as the loan is repaid. This option is useful for those who have an outstanding home or car loan liability. Policyholder can choose a sum assured and interest rate closest to the loan amount and interest. The choice of available interest rates includes 6, 8, 10, 12, 14, 16, 18 and 20 per cent. For example, if policyholder has taken a loan at 10.25 per cent, he may either select 10 or 12 per cent as rate of interest to prepare loan schedule under this plan. Similarly, the policyholder can select the sum assured nearest to the loan amount.
Pros
The policy offers rebate on taking a high sum assured.
Females enjoy discount on premium under level term and increasing term assurance options.Non-smokers enjoy premium discount as well.
The policy also offers a surrender value.
Premiums qualify for taxation benefits.
