Many times we are forced to take a personal loan to meet our expenses in times of emergency. A personal loan comes under the category of unsecured loans. Therefore, it is considered to be the loan with the highest interest rate. Do you know that personal loans can also be insured? Such insurance can prove to be very helpful in saving you from the burden of loan EMI in bad times.

What is Personal Loan Insurance?

Personal Loan Protection Insurance (PPI) is an insurance policy. You can buy it for financial security in times of crisis. PPI works as a security measure. In case of job loss or disability, PPI covers your loan repayment during the remaining period.

How does this policy operate?

Personal Loan Protection Insurance Policy operates like any normal insurance policy. You have the option to pay the premium in a lump sum amount. If you want, you can choose the option to include it in your equated monthly installments i.e. EMI. The premium for PPI depends on factors such as loan amount, age, health condition, and service time.

How much coverage is available?
This insurance reduces the financial responsibilities of your family by paying the outstanding loan in case of the death of the borrower. If the borrower becomes unable to work due to an accident or illness, the insurance pays the loan EMI for that period. On the other hand, if the borrower loses his job, the policy pays the loan for a certain period.

Benefits of Insurance
It protects borrowers and their families from future difficulties. There may be situations in the future that can cause financial difficulties. Personal loan insurance protects borrowers from the impact on their credit score due to late payment.

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