What is the importance of property insurance in LAP?

Opting for both property and life insurance is crucial when taking a loan against property (LAP). Property insurance safeguards your pledged collateral, like your home or commercial space, from natural disasters or other damage. This shields your asset's value and ensures the financial institution can recover pending loan amounts by liquidating your property if you default on loan repayment.

Life insurance covers the outstanding LAP amount in case of your unexpected demise. This relieves your family from bearing the loan repayment burden in your absence. Having adequate insurance in place is mandatory in most LAPs.

Insurance provides a safety net that secures your property investment, safeguards your family's financial future and gives you peace of mind. By protecting assets and mitigating risks, insurance enables a smooth, unencumbered borrowing experience during your LAP tenure.