Manage contingencies by availing loan against insurance policy
In a loan against insurance policy, your policy acts as a collateral or security against the loan amount, while you still have the coverage of your insurance policy intact.
Features and benefits of loan against insurance policies
00:47
All you need to know about our loan against insurance policy
Watch this video to know more about the key features of our loan against insurance policy.
-
Loans up to Rs. 25 crore*
Finance a diverse range of needs with funds up to Rs. 25 crore* against your endowment and ULIP policies.
-
Funding against policies under lock-in period
We cover your immediate liquidity needs even if the insurance policy is under lock-in period.
-
Get loan while keeping your insurance coverage intact
Get loans against your endowment and unit-linked insurance policy to meet your liquidity needs without having to surrender your policy. So, your insurance coverage and investment benefits remain intact.
-
Flexi loan against endowment and ULIP policies
Get a flexi loan against an endowment and Unit Linked Insurance Plan (ULIP). Make multiple withdrawals from your total sanctioned amount and pay interest only on the amount utilised.
-
Pay interest on completion of policy lock-in period
For loan against policies which are under lock-in period, you can repay the principal and interest amount together after the completion of the lock-in period.
-
Pre-approved loan limit
Get a minimum loan of Rs. 10,000 and maximum of up to Rs. 25 crore. This is applicable for the maximum tenure of up to 96 months. Get loan of up to 90% on policies against surrender value.
-
Easy prepayments
Flexible prepayment and foreclosure options let you prepay or foreclose your loan at no additional charges.
-
Apply with minimal documents
You only need to submit Officially Valid Document (OVD) for ID and address proof, bank account proof, and document proof of the insurance policy to apply for a loan.
Eligibility criteria and documents required
You can apply for our loan against insurance policies online if you meet the basic criteria mentioned below*. After meeting the criteria, you will need a set of documents to complete your application process.
Eligibility criteria
- Age: 18 years to 90 years
- Minimum surrender value of policy: Rs. 10,000
- Employment: salaried or self-employed
- Must have an active Endowment and ULIP policy of either Bajaj Allianz Life, ICICI Prudential, Max Life, TATA AIA, Aviva India, or Life Insurance Corporation of India (LIC)
- Nationality: Indian
Documents required**
- One copy of your recent photograph
- Aadhaar card/ passport/ voter’s ID as address proof
- PAN card
- Insurance policy document
- Bank account statement/ copy of a cheque as bank account proof
- Any other document as may be required by Bajaj Finance Ltd.
**Please note that the list of documents mentioned here is indicative. You will be notified on the complete list of documents required by our representative while filling the application form.
How to apply for a loan against insurance policy
01:14
A step-by-step guide to apply for loan against insurance policy
Step 1: Click on ‘Apply’ at the top of this page to open our online application form.
Step 2: Enter your name, email ID, and mobile number.
Step 3: Under ‘Type of Security’, select Insurance Policy and provide your surrender value.
Step 4: Select your city of residence and after agreeing to the terms and conditions, click ‘Submit’.
You will receive an OTP on the mobile number for verification. Enter the OTP to submit the form.
Once your application form is submitted, our representatives will get in touch with you for further proceedings.
Disbursement shall be done post complying with sanction terms, successful verification of Application and policy assignment.
-
Did you know?
You can get a loan against your policy still under lock-in period
-
Did you know?
You can access funds while keeping your insurance cover intact
-
Did you know?
You can avail loan against insurance policy with minimal documentation
-
Did you know?
You can pay interest only on amount utilised
Applicable fees and charges
The following charges are applicable on loan against life insurance policies:
| Types of fees | Charges applicable |
| Interest rate | Up to 24% p.a. In case of lock-in policies, compounding interest will be charged In case of lock-in free policies, simple interest will be charged |
| Processing fee | Up to 3% (inclusive of applicable taxes) of the loan amount or Up to Rs. 10,000 (inclusive of applicable taxes) |
| Flexi fee | Not applicable |
| Prepayment charges | Full prepayment - Up to 4.72% (inclusive of applicable taxes) on the outstanding loan amount as on the date of full prepayment Part-prepayment - Up to 4.72% (inclusive of applicable taxes) of the principal amount of loan prepaid on the date of such part prepayment |
| Bounce charges | In case of default of repayment instrument, Rs. 1,200/- per bounce will be levied. |
| Penal charge | For LIC (ULIP & Endowment) and Non-LIC (Endowment) Policies - Delay in payment of instalment(s) shall attract penal charge of Rs. 8/- per day per instalment from the respective due date until the date of receipt of the full instalment(s) amount. For Non-LIC (ULIP) Policies - Delay in payment of instalment (as per payment frequency mentioned in the Sanction Letter) shall attract penal charges as more particularly described in Annexure I from the respective due date until the date of receipt of instalment (as per payment frequency mentioned in the Sanction Letter) /principal/overdue amount. To view Annexure 1 kindly click here. |
| Instalment default charge | Rs 450/- per month from the first instalment due date for mandates rejected by customers bank until the new mandate is registered |
| Stamp duty (as per respective state) | Payable as per state laws |
| Mandate rejection charges | Rs. 450/- per month from the first month of due date for mandate rejected by customer’s bank until the new mandate is registered. |
| Stamp duty | Payable as per state laws |
| Annual maintenance charges |
Up to Rs. 2,949/- (inclusive of applicable taxes) if the loan tenure is above 12 months |
| Renewal Fees | Up to Rs. 2,950/- (inclusive of applicable taxes) to be collected on renewal |
| Legal charges | At actuals |
| Broken period interest/ pre-monthly instalment interest | Broken period/ pre-monthly instalment interest shall mean the amount of interest on loan for the number of day/s which is/are: Scenario 1: Over and above the period of 30 days from the date of disbursement of the loan Method of recovery of broken period interest/ pre-monthly instalment interest: Added to the first instalment amount Scenario 2: Less than period of 30 days from the date of disbursement of the loan, interest on first instalment will be charged for actual number of days |
| PG facility charges | Rs. 11 (Inclusive of applicable taxes) will be charged for utilising the payment gateway to make part or full payments towards the loan through digital properties. |
Frequently asked questions
If you need some financial help and looking for availing a loan, you can get a loan against your insurance policy. In this case, your insurance policy acts as the collateral against the loan amount.
The eligibility criteria for taking a loan against your insurance policy is relaxed compared to other types of loan. It depends on the type of insurance policy you own and whether it is approved for loan by the lender. Loan against Insurance Policy is given against Endowment and Unit-linked plans (ULIPs).
A processing fee up to 3% (inclusive of applicable taxes) of the loan amount or up to Rs. 10,000 (inclusive of applicable taxes).
1. If the policy is in a lock-in period, a bullet interest payment will be made on completion of the policy lock-in period. A bullet repayment is a lump sum payment made for the entirety of an outstanding dues under the loan amount at maturity.
2. If the policy is out of the lock-in period, the interest is calculated and payable monthly.
In case of lock-in policies, compounding interest is to be charged.
In case of lock-in free policies, simple interest to be charged.
It takes approximately 24 hours to process a loan against an insurance policy. This is subject to the submission of all required documents.
You need to present the following documents to avail of a loan against an insurance policy:
- One copy of your recent photograph
- PAN card
- Aadhaar card/ passport/ voter’s ID for address proof
- Valid insurance policy document
- Bank proof, such as bank account statement or cheque copy
No, you cannot convert the principal amount to EMIs.
Yes, there is an option for partial withdrawal during the subsistence of the loan. However, it is strictly subject to successful verification by the lender. Bajaj Finance holds the right to deny partial withdrawal requests at its sole discretion.
Yes, a policyholder with multiple ULIP policies can avail loan against all policies in one go. This is subject to the assignment of all the policies in favour of Bajaj Finance.
The policy has to be assigned in favour of Bajaj Finance Limited.
You can call the customer centre at 1800-123-2557 or write to us at Laip.care@bajajfinserv.in for any loan against insurance policy-related service requests.
All loans are processed by Bajaj Finance Limited.
In case the loan is availed, the policy will be assigned in favour of Bajaj Finance. There are two ways of closing the loan –
1.You can repay the total outstanding in Bajaj Finance Limited designated bank account. Post receipt of payment, loan account shall be closed and policy will be assigned back to you.
2.You can repay is repaying via surrendering the policy. Basis your request, the insurance company will surrender the policy and the surrender value will be transferred to Bajaj Finance Ltd., since the policy is assigned to them. Bajaj Finance will adjust s the loan amount and refund the surplus (if any) to the you and close the loan account.
Policy surrender will be at the discretion of the lender only.
Any intimation regarding premium payments is sent directly to the client by the insurance company.
