Branch² Intelligence
Underutilised loans against insurance policy
Key takeaway
Policyholders can now access loans against the surrender value of life insurance policies while keeping coverage intact.
- Step 1Policyholders can borrow against surrender value without surrendering policy.
- Step 2Insurance companies earn interest income on loans, boosting non-premium revenue.
- Step 3Policy retention improves, reducing lapses and stabilizing premium income.
- Step 4SMEs and individuals use this as cheaper credit, reducing demand for other high-cost loans.
Source: The Hindu BusinessLine
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