- Webpages
- Documents
- HDFC Life ClassicAssure PlusInvestment
- HDFC Life ClassicAssure PlusInvestment
- HDFC Life ClassicAssure PlusInvestment
For NRI Customers
(To Buy a Policy)
-
![Contact Image]()
Call (All Days, Local charges apply)
-
![Contact Image]()
Email ID
-
![Contact Image]()
Whatsapp
(If you're our existing customer)
-
![Contact Image]()
Call (Mon-Sat, 10am-9pm IST, Local Charges Apply)
-
![Contact Image]()
Email ID
For Online Policy Purchase
(New and Ongoing Applications)
-
![Contact Image]()
Call (All Days & Toll free)
-
![Contact Image]()
Schedule a call
-
![Contact Image]()
Whatsapp
-
![Contact Image]()
Give missed call to buy a policy
-
![Contact Image]()
Email
Branch Locator
-
![Contact Image]()
Locate a branch
For Existing Customers
(Issued Policy)
-
![Contact Image]()
Whatsapp
-
![Contact Image]()
Call (Mon to Sat, from 10 am to 7 pm, Call charges apply)
-
![Contact Image]()
Email
Fund Performance Check
-
![Contact Image]()
Call (Missed Call)
Home Loan Insurance
Home loan insurance is a protection plan that spares the family from the burden of repaying the home loan's liability in the event of the borrower’s death during the loan period. This insurance for home loan borrowers reduces the lender’s risk. It ensures that the banks/financial institutions recover the loan amount even in the event of the borrower’s death, disability or loss of income. The period of the loan protection plan coincides with the loan term. ...Read More
To delay is to regret
You may not always be around to take care of your family. And that’s when a term plan ensures your family is well protected.
:1800-266-9777
What is Home Loan Insurance?
Table of Content
1. Understanding Purpose and Coverage Duration in Home Loan Insurance
2. Importance of Home Loan Insurance
3. Characteristics of Home Loan Insurance
4. Best Type of Home Loan Insurance Policy in India
5. Benefits of Home Loan Insurance
6. Difference between Home Loan Insurance and Home Loan
7. The Role of Life Insurance in Loan Protection
8. Summary
Home loan insurance is a loan protection plan that minimises the risk for lenders and safeguards the borrower’s family from the burden of repaying the loan. It offers outstanding loan protection in unforeseen circumstances like the borrower's death, disability, or job loss during the loan term. The policy tenure will be the tenure of the loan. The insurance company is responsible for clearing the outstanding liability in the home loan if anything is uneventful, like disability or death of the borrower or if the borrower loses his job.
Understanding Purpose and Coverage Duration in Home Loan Insurance
To understand what home loan insurance is, you should also know the purpose, coverage, and duration of the home loan insurance. The details are as mentioned below:
Purpose
The purpose of the best home loan insurance policy is to safeguard the family from the burden of repaying the home loan and also to protect the interest of the lending institution. The insurance company clears the home loan outstanding in the event of the borrower’s death or impairment and loss of income.
Coverage Period
The coverage period will be the same as the loan period. If the home loan is for 30 years, the home loan insurance policy’s tenure will also be 30 years.
Importance of Home Loan Insurance
Home loan insurance should be considered for the following reasons:
Protects Family
If you purchase home loan insurance in India, the insurance company is responsible for clearing the outstanding liability in the home loan in the event of the borrower’s untimely death. This aspect provides financial security for the family without passing on the burden of repaying the home loan. It protects the family from a financial crisis or losing their home when they are dealing with an emotional challenge.
Safeguards Lenders
Banks and financial institutions have to face the risk of non-repayment if the borrower expires during the loan term. This loan default insurance protects the lender’s investment by offering coverage for the home loan liability. They take the onus of clearing the home loan dues under unforeseen circumstances.
Prevents Financial Strain
If you are the sole earning member in the family and have availed of a home loan, your family go through financial distress if anything uneventful happens to you during the home loan term. They may not be able to honour the monthly EMIs and may end up losing their home. Availing of insurance for home loan will mitigate this risk as the insurance company pays off the home loan dues.
Characteristics of Home Loan Insurance
The characteristics of home loan insurance are:
Premium Payment Options
The options available for premium payments of the best home loan insurance policy in India are:
Lum Sum Payment
The premium can be paid in one lump sum for the entire policy term.
EMI Integration
The premium can be included with the home loan amount and paid in monthly instalments with loan EMIs. If the borrower is not able to pay the premium in one go, this option will be convenient.
Joint House Loan Borrowers
If the home loan has multiple borrowers, i.e., if it is availed in joint names, the insurance for home loan borrowers provides coverage to all the borrowers. If any of the joint borrowers expire during the home loan tenure, the insurance company provides coverage to the extent of the deceased joint borrower’s share. The joint borrowers will generally be the borrower’s parents, spouse, or children.
Riders and Add-Ons
Home loan insurance can be considered peace of mind insurance as it has provisions for riders and add-ons besides offering loan repayment security, and they are:
Basic Coverage
The main purpose of home loan insurance in India is to provide home loan coverage and take responsibility for repaying the outstanding liability if the borrower dies during the loan term.
Additional Riders
You can also choose add-ons like critical illness insurance and death and disability coverage, Some home loan insurance policies provide loss of income riders and provide coverage to the extent of 6 months’ EMI if the borrower loses his job.
Best Type of Home Loan Insurance Policy in India
The best home loan insurance policies in India are:
Hybrid Home Loan Insurance Plans
Under this best home loan insurance policy in India, the coverage does not change during the first year. From the second year onwards, it keeps changing according to the outstanding liability as the liability starts declining after the second year.
Level Cover Plan
A level cover plan is a mortgage insurance plan wherein the coverage amount remains constant for the entire home loan term.
Reducing Property Insurance for Home Loans
The home loan insurance coverage amount keeps changing with the outstanding liability. As and when the EMIs are paid, the debt keeps decreasing and the coverage changes accordingly.
Benefits of Home Loan Insurance
Now that you understand what is home loan insurance, you will be convinced that covering the home loan liability is a smart decision considering the following benefits.
Economical
The premium payment options in the borrower life insurance plan make it affordable to them. The borrowers can choose to pay the premium for the entire policy term up front or can opt to include it with the home loan amount and pay it in instalments along with the home loan EMI.
Protection
The primary benefit of home loan insurance is the home loan safeguard. The family members may find it difficult to repay the loan in the absence of the borrower, and the collateral may be confiscated. Investing in a home loan insurance policy amounts to financial planning for home loan. The insurance company clears the home loan outstanding in the event of the borrower’s untimely demise and spares the family from the debt burden.
Tax Benefits
Home loan insurance reduces the overall tax burden. The home loan insurance premiums qualify for deduction under Section 80C of the Income Tax Act 19611.
Difference between Home Loan Insurance and Home Loan
The difference between home loan insurance and home loan is explained in the table below:
Point of Basis |
Home Loan Insurance |
Home Insurance |
Meaning |
The outstanding liability in a home loan is paid by the insurance company if the borrower dies during the home loan term. |
The insurance company compensates for the damage caused to the structure or things in the house due to unforeseen incidents. |
Coverage |
To the extent of the home loan liability. Pays off the dues in case of the death of the borrower |
Covers the structure of the house and the items in the house against calamities. |
Down Payment |
Helps to reduce the home loan EMI |
Has no effect |
Who can purchase |
Only home loan borrowers can purchase the policy |
Anybody can purchase the plan irrespective of whether they have a home loan or not. |
The Role of Life Insurance in Loan Protection
Life insurance acts as a financial safety net, supplementing house loan insurance. While home loan insurance only covers the outstanding balance of a house loan, life insurance offers greater protection. It guarantees your family's financial well-being by providing a lump sum payout that may be used for a variety of objectives, such as repaying the mortgage, covering living expenses, or fulfilling other financial goals. Investing in a good life insurance plan in addition to house loan insurance increases the security for your loved ones, protecting their future from both loan liabilities and other risks.
Summary
If your family’s financial stability is your priority, you should also consider ways of loan risk mitigation. A home loan, for instance, can be a huge economic burden for your family if they have to manage the EMIs in your absence. Home loan insurance safeguards them from this risk. The insurance company pays off the outstanding liability in the event of your untimely demise, impairment, or loss of income. Additionally, the home loan policies secure home loan payments and reduce the lender’s investment risk. Availing of home loan insurance along with a home loan is a prudent decision as it gives you peace of mind that your home is safe even when you are not around to repay the loan.
FAQs on Home Loan Insurance
Q: Is there any insurance on a home loan?
Yes. There is life insurance for home loan holders that will take care of the loan repayment if anything untoward happens to the borrower during the loan term. It mitigates the investment risk for lenders and safeguards your family from the home loan burden.
Q: Is it good to take home loan insurance?
Yes. It is good to take home loan insurance as it safeguards loan repayments in the event of impairment, loss of income, critical illness, or death of the borrower. Your family will not have the burden of honouring EMIs and the lender gets the assurance of loan recovery in case of unforeseen events.
Q: What is the cost of home loan insurance?
The cost of home loan insurance depends on the home loan amount and the term. It also varies with the insurance company.
Q: Does home loan insurance cover death?
Yes. Home loan insurance covers death, critical illness, permanent disability, and loss of income.
Q: How much does home insurance cost in India?
Home loan insurance in India cost depends on the quantum of home loan, tenure, and the insurance company. You can provide the inputs in a home loan insurance calculator for a premium estimate. Compare the premiums of various insurance providers and decide on the one that suits your budget.
Not sure which insurance to buy?
Talk to an
Advisor right away
Advisor right away
We help you to choose best insurance plan based on your needs
Share your Valuable Feedback
Thank you for submitting your feedback
Francis Rodrigues
Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.
Written By:
Vishal Subharwal
Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.
Reviewed By:
Articles on Life Insurance
HDFC Life
Reviewed by Life Insurance Experts
HDFC LIFE IS A TRUSTED LIFE INSURANCE PARTNER
We at HDFC Life are committed to offer innovative products and services that enable individuals live a ‘Life of Pride’. For over two decades we have been providing life insurance plans - protection, pension, savings, investment, annuity and health.
1. Tax benefits & exemptions are subject to conditions of the Income Tax Act, 1961 and its provisions. Tax Laws are subject to change from time to time. Customer is requested to seek tax advice from his Chartered Accountant or personal tax advisor with respect to his personal tax liabilities under the Income-tax law.
@As per integrated annual report FY23-24, available on www.hdfclife.com. As of May 2024
^ Available under Life & Life Plus plan options
#Provided we have received all the relevant and required documents and no further investigation is required. Claim settlement process would be completed within stipulated timelines once the claim request is approved
##Individual claim settlement ratio by number of policies as per audited annual statistics for FY 23-24
*Online Premium for Life Option, Male Life Assured, Non-Smoker, 20 years of age, Policy term of 25 years, Regular pay, Annual frequency, exclusive of taxes and levies as applicable. (Monthly Premium of Rs1047/30=34.9)
***Online Premium for Life Option for HDFC Life Click 2 Protect Super (UIN: 101N145V06), Male Life Assured, Non-Smoker, 20 years of age, Policy term of 25 years, Regular pay, Annual frequency, exclusive of taxes and levies as applicable. (Monthly Premium of 622/30=20.7).
ARN - DM/01/25/20287
