Over Draft Against Insurance Policy
Insurance Policy by Public or Private Insurers is another type of pledged security against
- Insurance Policy by Public or Private Insurers is another type of pledged security against which Overdraft facility can be obtained.
- The bank or lending institute determines the actual amount of premium paid on the insurance policy and the amount on maturity to set the Overdraft limit.
- In case of the death of customer the overdrawn amount is recovered from the claim settlement on the policy from the Insurance Company.
The borrower and/or the guarantors have to provide the following documents to the banks or the lending institutions while submitting Overdraft against Insurance Policy. Certain documents may be demanded by the bank or the lending institutions in post sanction phase or on periodical basis.
- Address Proof : Latest Electricity/Telephone Bill or Receipt of Maintenance Charges or Valid Passport or Voter?s Identity Card or Purchase/Lease Deed/ Leave & License Agreement of Residence or Office Premises.
- Identity Proof : Valid Passport, PAN Card, Voter?s Card, Any other photo identification issued by Government Agencies.
- Business Proof : VAT/CST Registration No. or MIDC Agreement or SSI Permanent Registration Certificate or Warehouse Receipts or Shop & Establishment Act Certificate or Copy of Lease Agreement along with the latest Rent paid Receipt.
- Business Profile on Company?s Letterhead.
- Partnership deed in case of partnership firms.
- Certificate of incorporation, Date of Commencement of Business and Memorandum of Title Deeds, Form 32 in for Addition or Deletion of Directors in case of companies.
- Last three years Trading, Profit & Loss A/c. and Balance Sheets (duly signed by a Chartered Accountant wherever applicable).
- Last one years? Bank statement of the Firm.
- If existing loan, then sanctioning letter and repayment schedule of the same.
- Firm/Company?s PAN Cards.
- Individual Income Tax Returns of the Individual/Partners/Directors for last three years.
- Last one years? Bank statement of Individuals, Partners, Directors .
- Policy Document.
- Receipt of the latest Premium paid.
- Surrender Value Statement from LIC.
- NOC from the Nominee/s of the LIC policy.
The following are the sequence of steps taken by the banks on receipt of completed application forms.
- Application form is accepted and acknowledged.
- Personal interview /discussions is held with the customers by the bank's officials.
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Bank's Field Investigation team visits the business place/work place of the applicant.
(All the documents submitted are verified by the bank with the originals so as to ensure the authenticity of the same.) - Bank verifies the track record of the applicant with the Credit Information Bureau (India) Limited (CIBIL).
- In case of fresh projects the bank analyses the back ground of the applicant/firm/company and the Technical feasibility/financial viability of the project based on various parameters and also the existing market conditions.
- Depending on the size of the project the file is put up for sanction to the appropriate level of authority.
SANCTION AND DISBURSEMENT :
- On approval/sanction, the sanction letter, is issued specifying the terms and conditions for the disbursement of the loan. The acceptance to the terms of sanction is taken from the Applicant.
- The processing charges as specified by the bank have to be paid to proceed further with the disbursement procedure.
- The documentation procedure takes place viz.Legal opinion of various property documents and also the valuation reports.(Original Documents to title of the immovable assets are to be submitted)
- All the necessary documents as specified by the legal dept., according to the terms of sanction of the loan of the bank are executed.
Disbursement of the loan takes place after the Legal Dept. certifies the correctness of documents executed.
