When it comes to availing and applying for loans in India, you may come across people talking about many options in India. However, most of the discussions are only about some popular options like personal loans, home loans and others.

You would rarely come to know or hear anyone discussion about the loan against the insurance policy. The primary reason for this is the unawareness and of course, India’s insurance penetration which is below the global average index.

The loan against an life insurance policy is a loan type where you need to pledge the invested worth of the policy and get money against it. It is fairly a popular practice in western countries and is yet to trend in India.

Such kinds of loans are offered either by insurance companies or banks and non-banking finance companies (NBFCs). The lender considers the insurance policy as the security or collateral to offer you money as per your need.

Depending on the worth of your portfolio, you can get access to the loan amount and cover diverse needs.

Loan against life insurance policy – A quick look at major benefits:

1) Be ready to enjoy a high loan value

If you have the required eligibility of a lender, you can easily avail a high loan amount of up to Rs.10 crore. As a result, you can get funds to cover your personal and professional needs.

2) Enjoy the assistance of the Relationship Manager

Leading (NBFCs) appoint a dedicated Relationship Manager to all customers. Yes, whoever applies for the loan against life insurance policy account gets this facility. You can connect with a Relationship Manager to inquire about all loan concerns.

3) Easy eligibility terms

You can apply for the loan against life insurance policy if you can prove your eligibility as specified by your lender. However, some of the common eligibility terms for applying for the loan against insurance policy account are:

-The loan applicant should be a residing citizen of India and not an NRI
-His/her age should be at least 21 years at the time of applying for the loan
-One needs to have a consistent income source and should either be a salaried individual or self-employed
-Only an individual can apply for the loan against an insurance policy
-Minors, HUF and joint business owners and companies are prohibited from applying for the loan
-The minimum worth of your portfolio ought to be Rs.10 lakh to be eligible to apply
-The maximum loan amount that you can apply for is Rs.10 crore

4) Hassle-free documentation

You only need to submit/furnish some basic documents. It may be related to your address and ID along with income and insurance policy. Have a look:

✓ID proofs such as PAN Card, Driving License or Aadhaar Card
✓Address proof such as Aadhaar Card
✓Salary Slips
✓Passport-sized colour photograph
✓Documented proofs of having invested in a legal insurance policy

How to apply for the loan against insurance policy online?

You can apply for a loan against life insurance policy online these days and to a leading online lender. You need to follow the below steps to start applying right away:

1) You need to land on loan against a life insurance policy page of the lender and fill out an online application form.
2) You will then receive a confirmation text message and email about letting you know about the status of your application.
3) Submit the earlier discussed documents to the lender’s representative. He/she will connect with you take things forward and to the next level.
4) You will then receive the amount in your bank account after the verification of the documents. You will be handed over the login credentials of your online loan account to track its progress 24/7 and from anywhere.