“Home” is a dream for many people, but due to the high cost of this dream, very few can afford to pay for it all at once. Therefore, applying for a loan to pay for a home is something many people need to do to turn their dreams into reality.

However, those who take on the responsibility of paying for a home carry a heavy burden and are also a support for the remaining family members. If an unexpected event occurs to the borrower or loan applicant, it can lead to significant consequences. Thus, this article will delve into the meaning of home loan insurance and how to choose the coverage period that best suits your needs and financial situation.

What is Home Loan Insurance?

Home loan insurance, or MRTA (Mortgage Reducing Term Assurance), is a life insurance policy that provides coverage during the period of the home loan repayment. The loan applicant can choose a coverage period ranging from 1 to 30 years (with the maximum coverage age not exceeding 65 years) and can select the coverage amount according to their needs, whether it be 100% or a portion of the loan amount.

In the event that the loan applicant passes away or becomes permanently disabled, the life insurance company will pay benefits to the first beneficiary, which is the lending bank, according to the insured amount specified in the contract. This amount will not exceed the outstanding debt owed to the lending bank. If there are remaining benefits, the insurance company will pay them to the next beneficiaries, thus relieving the heirs of the heavy burden or reducing their debt obligations.

How to Choose the Right Coverage Period for Your Life

Many people may still be confused about how to choose the right coverage period and may want to know the premium rates for different coverage periods. This article will outline four main methods for selecting the coverage period and will show the premium rates for 100%, 70%, and 50% coverage of home loan insurance by OCEAN LIFE Thai Samut Insurance.

  1. For those who want to pay premiums gradually, choose a coverage period of 1 year.

Home loan insurance requires a one-time premium payment when the contract is initiated. Therefore, if the requested loan amount is very high, the life insurance premium will also be high. Choosing a coverage period of 1 year and renewing the contract periodically can help keep the life insurance premium affordable for the loan applicant.

  1. For those planning to refinance, choose a coverage period of 3 years.

Generally, if a loan applicant intends to refinance, it is usually done after approximately 3 years of repayment, as banks often set the redemption period at 3 years. Refinancing a home after the redemption period usually incurs no penalties, so most people tend to choose to refinance their homes after the 3-year mark.

  1. For those who want tax deductions, choose a coverage period of 10 years.

According to the law, life insurance that can be used for tax deductions must have a coverage period of at least 10 years.

  1. For those who want coverage throughout the home loan repayment period, choose a coverage period equal to the loan term.

Example: Mr. A, aged 35, borrows 2,000,000 Baht to buy a house and wants to repay it over 12 years.

Special Promotion for TerraBKK Readers

Apply forhome loan insurance here
Online applications receive a 500 Baht Shopee discount, subject to terms and conditions.

Activity Details: Customers applying for home loan insurance online and paying the first-year premium of 10,000 Baht or more between May 1 – 31, 2024, and whose insurance is approved by June 30, 2024, will receive a 500 Baht Shopee discount.

Activity Period: From May 1-31, 2024.

Prize: A 500 Baht Shopee discount code when applying for home loan insurance (limited to 100 prizes).

Eligibility for Participation

  1. For customers applying for home loan insurance online at www.ocean.co.th and entering the code TERRA24MRTA during the insurance application process, with a minimum first-year premium payment of 10,000 Baht or more between May 1-31, 2024, and whose insurance is approved by June 30, 2024.
  2. Employees, life insurance agents, or brokers of OCEAN LIFE Thai Samut, including their families, are not eligible to participate in this activity.

How to Participate

  1. Apply for insurance according to the eligibility criteria set for this activity.
  2. Insurance coverage is subject to the conditions and criteria set by the company. Coverage and benefit payments are according to the policy conditions.
  3. Applicants should study additional information and understand the details of coverage conditions, benefits, and exclusions before deciding to purchase insurance. After receiving the policy, please study further.

Conditions for Receiving Prizes

  1. Only participants who comply with the specified methods will be eligible.
  2. Only those who purchase insurance between May 1-31, 2024, will qualify.
  3. Prizes are limited to 100, throughout the activity period or until prizes run out. Each participant is limited to one prize only.
  4. On the day of receiving the prize, the insured must not have requested to cancel the policy (Free Look) or requested a refund of the policy contract or cancellation of the insurance contract on the day of receiving the prize. If there is a request to cancel the policy (Free Look) or refund the policy contract or cancel the insurance contract, the company may deduct the prize value from the amount refunded to the insured. If the refund amount is less than the prize value, the insured must compensate the difference.
  5. The company will deliver the prize to the phone number provided during the insurance application within 60 days after receiving insurance approval.

Conditions for Using the Shopee Discount Prize

  1. Can be used to pay for products at Shopee.
  2. The prize can only be used within the period and procedures set by the provider.
  3. If the prize expires, is lost, or is not used, no replacement or refund can be requested. The company reserves the right not to be responsible in all cases.
  4. If the service fee is less than the prize value specified in this activity, participants will not receive any change. If the service fee exceeds the prize value, participants must pay the difference themselves.
  5. Conditions and details of service usage are as specified by the provider. The company is merely promoting and organizing the activity.
  6. The company is not involved in the distribution of prizes and will not be responsible for the quality or service that may arise with the prize. If there are issues with quality or service, participants must contact the company providing the service directly.
  7. For further inquiries, contact Shopee (Thailand) customer service at 0-2017-8399 during business hours (Monday - Friday from 09:00 to 17:30, excluding public holidays).

General Terms and Conditions

  1. Cannot be exchanged or redeemed for cash or other items.
  2. Cannot be used in conjunction with other promotions.
  3. Cannot transfer the right to receive prizes to others. If violated, the winner must bear the expenses incurred.
  4. Prizes received from this promotional activity are for participants who have complied with the company's specified conditions only. They are prohibited from being sold or used commercially.
  5. The company may change the prize to another of equal value.
  6. Participants agree that the company may use details, including images of printed materials, for advertising and promotion without any cost.
  7. Participants acknowledge and agree that the company may collect, use, or disclose personal information provided during this activity for the purpose of presenting, advertising, promoting the company's products or services, conducting marketing activities, and analyzing data for product or service development or improvement.
  8. Participants have understood the conditions of the activity and agree to comply with all terms and conditions specified in this activity.
  9. The company's decision is final.
  10. For further inquiries, contact the customer service center at 1503
    (Monday - Friday from 08:00 to 18:00, Saturday - Sunday from 08:00 to 17:00, excluding public holidays).

Important Notes:

  • Insurance coverage is subject to the conditions and criteria set by the company.
  • Coverage and benefit payments are according to the conditions specified in the policy.
  • Life/health insurance premiums can be used to reduce personal income tax according to the criteria set by the Revenue Department.
  • Insured individuals wishing to use life/health insurance premiums for tax deductions must express their intention and consent for the company to submit life/health insurance premium information to the Revenue Department.
  • Payment of premiums is the responsibility of the insured. The collection of premiums by life insurance agents is merely a service.
  • The information in this document is only a preliminary overview of the insurance product. Applicants/insured individuals should study additional information and understand the details of coverage conditions, benefits, and exclusions before deciding to purchase insurance. After receiving the policy, please study further.