Date:23/08/2006 URL: http://www.thehindubusinessline.com/2006/08/23/stories/2006082302580600.htm

PNB cover to home loan borrowers

Our Bureau

New Delhi, Aug. 22

Punjab National Bank (PNB) has entered into a tie-up with Tata AIG Life Insurance to offer insurance covers to home loan borrowers.

A new product — `Mortgage Reducing Term Assurance'— has been launched by PNB for its existing as well as new housing loan borrowers.

Under the scheme, the bank would offer insurance cover of loan outstanding on the payment of a single one-time premium to protect the house and save the bereaved family from housing loan debt in case of death of the borrower.

A release by PNB said that a very low premium, approximately 2.5 per cent of the loan amount, is to be paid as one-time premium at the age of 40 for repayment tenor of 15 years. This is a one-time premium that is financed by the bank as part of the housing loan. This product would also be optional for the borrower and the maximum sum insured could be Rs 1 crore. The insurance cover would be available for the period up to 20 years or 65 years of age, whichever is earlier.