A life insurance policy offers monetary protection to you and your loved ones. While there are various types of life insurance policies, few of them, such as a whole life insurance policy and ULIPs offer a unique feature called ‘cash value’ or ‘cash surrender value’ that can come handy during financial emergencies. The cash value is the amount that you can access on surrendering your life insurance policy before its maturity.
You can access the cash value of your insurance to realise your personal and professional goals. Be it to bridge a short-term monetary gap while building a home or to fund your child’s higher education costs, your policy’s cash value will help you meet your needs with ease. So explore the most effective ways to access your policy’s cash value below.
Take a loan against the insurance policy
Availing a loan against insurance policy from the respective insurer or from a financial institution is a convenient way of utilising the cash value of your insurance policy. If you have a temporary cash crunch and are ready to repay the loan within a short tenor, then pledging your insurance policy to get a loan is a viable option. Here, insurers reduce the death benefit by the loan amount plus accrued interest. Once you repay the loan, your death benefit will be restored.
Every lender accepts varied types of policies as collateral, as long as it features on its list of approved scrips. For instance, Bajaj Finserv accepts Bajaj Allianz ULIPs as collateral. So, by pledging a policy that qualifies, you can avail a Loan Against Insurance Policy from Bajaj Finserv and access a significant loan amount of up to Rs.10 crore, which you can repay in 12 months.
Also, the loan against insurance policy interest rate is lower than that of personal loans, and to make repayments easy Bajaj Finserv allows you to take the loan on a Flexi basis. Here you can withdraw from your sanction as and when needed and pay interest only on the sum you utilise. Also, you can choose to pay interest-only EMIs and repay the principal amount at the end of the tenor. You can also enjoy other services and benefits such as a dedicated relationship manager, fast disbursal within 72 hours, and nil foreclosure and prepayment charges.
Surrender your policy to your insurer
You can also access your insurance policy’s cash value by surrendering the entire policy or a part of it to your insurer. To get access to funds in this manner, you will have to part with the death benefit to the extent of the surrender value of the policy.
As you avail an insurance policy to mainly enjoy monetary protection, make sure that you can repay the loan in time so as not to lose out on the death benefit. That said, this option is safest only when you have an additional insurance policy to fall back on.
Use your insurance policy’s cash value to the fullest and get easy access to funds to meet emergencies and goals alike. Before you do so, be sure to check your pre-approved offer from Bajaj Finserv to view your customised offer.
Bottom Line: If you have invested in insurance policies, then you should avail this loan facility which could help in your financial struggles when you are short of funds either for your business needs or personal needs. Check all the financial institutions which are offering this loan facility and then apply for a loan against the insurance policy.
You can access the cash value of your insurance to realise your personal and professional goals. Be it to bridge a short-term monetary gap while building a home or to fund your child’s higher education costs, your policy’s cash value will help you meet your needs with ease. So explore the most effective ways to access your policy’s cash value below.
Take a loan against the insurance policy
Availing a loan against insurance policy from the respective insurer or from a financial institution is a convenient way of utilising the cash value of your insurance policy. If you have a temporary cash crunch and are ready to repay the loan within a short tenor, then pledging your insurance policy to get a loan is a viable option. Here, insurers reduce the death benefit by the loan amount plus accrued interest. Once you repay the loan, your death benefit will be restored.
Every lender accepts varied types of policies as collateral, as long as it features on its list of approved scrips. For instance, Bajaj Finserv accepts Bajaj Allianz ULIPs as collateral. So, by pledging a policy that qualifies, you can avail a Loan Against Insurance Policy from Bajaj Finserv and access a significant loan amount of up to Rs.10 crore, which you can repay in 12 months.
Also, the loan against insurance policy interest rate is lower than that of personal loans, and to make repayments easy Bajaj Finserv allows you to take the loan on a Flexi basis. Here you can withdraw from your sanction as and when needed and pay interest only on the sum you utilise. Also, you can choose to pay interest-only EMIs and repay the principal amount at the end of the tenor. You can also enjoy other services and benefits such as a dedicated relationship manager, fast disbursal within 72 hours, and nil foreclosure and prepayment charges.
Surrender your policy to your insurer
You can also access your insurance policy’s cash value by surrendering the entire policy or a part of it to your insurer. To get access to funds in this manner, you will have to part with the death benefit to the extent of the surrender value of the policy.
As you avail an insurance policy to mainly enjoy monetary protection, make sure that you can repay the loan in time so as not to lose out on the death benefit. That said, this option is safest only when you have an additional insurance policy to fall back on.
Use your insurance policy’s cash value to the fullest and get easy access to funds to meet emergencies and goals alike. Before you do so, be sure to check your pre-approved offer from Bajaj Finserv to view your customised offer.
Bottom Line: If you have invested in insurance policies, then you should avail this loan facility which could help in your financial struggles when you are short of funds either for your business needs or personal needs. Check all the financial institutions which are offering this loan facility and then apply for a loan against the insurance policy.
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