All about HDFC life loan process
Published On Jan 04, 2023 11:20 AM By InsuranceDekho
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In today’s time, a financial emergency can knock on your door at any point in time. Be it for building your dream house, financing your children’s education, buying a new car, or anything else, many a time it so happens that you need immediate financial help. In such instances, the easiest option is to take a loan from any financial institution. Many people also take loans against their life insurance policy. HDFC Life, one of the leading life insurance companies in India, also provides loans for the benefit of its policyholders. Read on to know more about the HDFC life loan process.
What is HDFC Life Loan Process
At times when policyholders lend money from HDFC Life Insurance company, they become the ‘borrower’. The policyholder can do so against the surrender value of their life insurance policy, provided that HDFC Life agrees to lend a certain amount of money upon which interest is also charged. However, there are certain terms and conditions associated with taking loans from HDFC Life. Listed below are the terms and conditions you should know about:
- For security purposes, once a policyholder decides to lend money from HDFC Life, then the policy is assigned to HDFC Life. This means that all the benefits accrued shall now be with HDFC Life until the repayment of the loan.
- The policyholder is liable to repay the loan amount with a specific rate of interest charged on the principal amount. The interest rate shall be charged as soon as the loan amount is disbursed. The loan can be repaid either in monthly installments or EMIs.
- In case the borrower fails to repay the amount in any particular cycle, then they must inform HDFC Life about the same. It is also important to understand that it is the sole responsibility of the borrower to repay the money on time, and HDFC Life is not at all liable to provide reminders about the payment date. In case there is any delay in payments, then additional interest can be charged if HDFC Life is not informed about it. Moreover, a notice of 3 months is also sent to the borrower’s communication address to recover all the outstanding amount.
- Once the loan amount is repaid on time, then the policy will be assigned back to the policyholder from HDFC Life.
- The borrower is not allowed to make any changes in the loan repayment tenure such as the EMI paying frequency cannot be changed, the interest rate also remains unchanged, and the loan amount also cannot be increased.
- In case the policy matures or is surrendered, and there are outstanding EMIs, then HDFC Life shall deduct all the benefit amounts and the remaining amount will be paid to the policyholder/borrower.
- HDFC Life holds all rights to change the terms and conditions of the policy, and the same shall be duly communicated to the borrower/policyholder in advance.
- In the loan repayment period, you are not allowed to make any partial transactions or even get the sum assured of your policy changed.
- The policyholder/borrower agrees to receive SMS, phone calls, and other types of communication from HDFC Life, once they have agreed to lend a specified amount of money from the company.
- The borrower/policyholder of the HDFC Life insurance plan holds the right to ask for payment receipts and break-ups of the outstanding amount at any point in time.
How to Take a Loan from HDFC Life?
The process of taking loans from HDFC Life is quite a simple process. Here is how you can take a loan from HDFC Life:
- There are a number of plans that cannot act as loan collaterals. Thus, as the first step, you need to check with HDFC Life, whether your plan qualifies for getting loans or not.
- In case your existing plan is not apt for getting loans from HDFC Life, then you can purchase a new HDFC Life insurance plan.
- Next, you can apply for loans online and enter details about the policy, loan amount, loan repayment frequency, and other details. You also need to submit your income proof which shall validate your capability in repaying the loan amount on time.
- Once all the documents are successfully verified, then you will receive a notification about your loan application being processed.
Apart from the online process of applying for loans, you can alternatively also apply for loans in an offline manner. All you need to do is visit the nearest office of HDFC Life, fill out the loan application form, get all your documents verified, and finally get your loan approved.
So, you can easily apply for loans against your life insurance plans with HDFC Life. You can do so either through an online or offline process. More than anything else, remember to pay the loan amount on time so that you are not charged any penalties or additional rates of interest.
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