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Buying a home is a major financial commitment, often requiring the support of home loans. These loans come with regular EMIs (Equated Monthly Installments), which borrowers need to manage over the years. An EMI calculator helps you figure out your monthly payments, making financial planning easier.
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But, what happens if the main income earner is no longer around? This is where term insurance plays a crucial role in securing your home loan and protecting your family’s financial future. Let us understand how an EMI calculator works, its importance in managing home loans, and how term insurance can provide the security needed for such financial commitments.
An EMI calculator is an online tool that helps you estimate your monthly home loan payments. By entering the loan amount, interest rate, and loan tenure, you can easily find out the EMI you'll need to pay each month.
Financial Planning: Helps you plan your monthly budget by estimating how much you’ll pay towards your home loan.
Loan Comparison: Allows you to compare different loan offers from banks and choose the one with the best terms.
Quick & Easy: Saves time by giving you an instant EMI calculation without complicated manual formulas.
A term insurance plan ensures that your loved ones won’t be burdened with your home loan in case of your untimely demise. By using an EMI calculator, you can better understand your financial commitments and choose the right term insurance cover to safeguard them.
Ensured Loan Repayment: A term or life insurance policy ensures that your family can repay the loan even if you’re no longer around.
Stress-Free Financial Planning: Knowing that your home loan is backed by term insurance gives you peace of mind, letting you focus on other financial goals.
Affordable Protection: For a small premium, you can secure your family’s future and protect them from the burden of home loan repayment.
The EMI is calculated using the following formula:
EMI=(1+r)n−1P×r×(1+r)n
Where:
r = Monthly interest rate (annual interest rate divided by 12)
n = Loan tenure in months
P = Loan amount
By using an online EMI calculator, you can enter these details and instantly get the monthly payment amount, helping you understand how much you need to budget for each month.
Taking a home loan is a long-term commitment, and in the event of an unforeseen incident, your family may be left with the burden of paying off the remaining loan. This is where term insurance for home loan becomes essential.
Financial Security for Your Family: If the policyholder passes away during the policy term, the insurance payout can be used by the family to repay the home loan.
Customised Coverage: You can choose a sum assured equivalent to the outstanding loan amount, ensuring that your family will have enough to pay off the loan without any worries.
Tax Benefits: Both home loans and term insurance plans, provide you with tax benefits. You can take a look at the prevailing tax laws to learn the tax benefits applicable for your profile.
Peace of Mind: Term insurance provides peace of mind, knowing that your family will not face the financial strain of managing EMIs in your absence.
When planning to secure your home loan with term insurance, an EMI calculator can help you determine the right cover. Here’s how:
Calculate the EMI: Use the EMI calculator to determine how much you will need to pay each month for your home loan.
Check the Total Loan Amount: Multiply the EMI by the loan tenure to understand the total amount payable.
Choose the Term Insurance Cover: Based on your loan amount, select the best term insurance plan that offers coverage equal to or slightly higher than your outstanding loan. This ensures your family can clear the debt if something happens to you.
Here is a list of all the benefits of protecting your home loan with term insurance plans in India:
Complete Loan Protection: Term insurance ensures that the home loan will be fully repaid in case of the policyholder's death.
Affordable Premiums: Term insurance is a cost-effective way to secure your home loan compared to other insurance options.
Family’s Financial Protection: The term insurance payout can help your family tale care of their financial needs like child’s fees, other outstanding debts, and more.
Additional Benefits with Riders: You can add critical illness or accidental death benefits to your term insurance for enhanced coverage, especially if the loan is a significant financial responsibility.
Peace of Mind: Your family is protected from the financial burden of repaying the loan, even in your absence.
| Criteria | Details |
| Age | 18 to 65 years, depending on the insurer. |
| Loan Amount | You should ensure your term insurance coverage matches or exceeds your home loan amount. |
| Medical Examination | The insurer may require medical tests based on the sum assured and policy tenure. |
| Income Proof | Income proof, such as salary slips or bank statements, to determine premium and coverage. |
| Residency Status | For NRIs, additional documents like passport or NRI certificate may be needed to buy term insurance for NRIs. |
Using an EMI calculator helps you plan your home loan repayments effectively, while term insurance ensures that your family is financially secure if you are no longer able to make those payments. By understanding your loan obligations through the EMI calculator and choosing the right term insurance cover, you can protect your loved ones from financial difficulties and keep your home loan secure.
Note: You should also check the benefits of term life insurance if you are planning to purchase the term insurance plan.
†Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
+Rs. 487/month (Rs.16/day) is starting price for a 1 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 38 years of age.
Prices offered by the insurer are as per the approved insurance plans | #All savings and online discounts are provided by insurers as per IRDAI approved insurance plans | Standard Terms and Conditions Apply | **Tax Benefits are subject to changes in tax laws.| Policybazaar Insurance Brokers Private Limited
We will respond in the first instance within 30 minutes of the customers contacting us. 30-minute claim support service is for the purpose of giving reasonable assistance to the policyholder in pursuance of the claim. Settlement of claim (including cashless claim) is the responsibility of the insurer as per policy terms and conditions. The 30-minute claim support is subject to our operations not being impacted by a system failure or force majeure event or for reasons beyond our control. For further details, 24x7 Claims Support Helpline can be reached out at 1800-258-5881
For more details on risk factors, terms and conditions, please read the sales brochure carefully before concluding a sale
Policybazaar Insurance Brokers Private Limited | CIN: U74999HR2014PTC053454 | Registered Office - Plot No.119, Sector - 44, Gurgaon, Haryana – 122001 | Registration No. 742, Valid till 09/06/2027, License category- Composite Broker Visitors are hereby informed that their information submitted on the website may be shared with insurers. Product information is authentic and solely based on the information received from the insurers.
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+Rs. 820/month is starting price for a 2 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 38 years of age.
+Rs. 1,443/month is starting price for a 5 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 38 years of age.
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