Insurance Policy-backed Loan

Introduction to service

Bank loan is available for a life insurance contract for any of the three insurance types of permanent life insurance, other pure endowment insurance than annuity and endowment life insurance that meets the following conditions:

1.      The insurance contract carries a cash value (amount refunded when the contract is terminated) that will not be reduced as time elapses during the loan term;

2.      The insurance contract is valid and carries no overdue premium and interest;

3.      The age of the policyholder is within the scope delimited for bank loans;

4.      The insurance contract (generally for life insurance of a saving nature) carries some cash value, including the life insurance of lump-sum payment of premium and the life insurance for which premium has been paid for more than 2 years.

Application requirement

The loan applicant must be a policyholder. For an insurance contract that uses death as the condition for payment of insurance benefit, the written consent of the insured (or his/her legal guardian) needs to be obtained.

Information to be submitted

1.      After obtaining the consent of the insured, the borrower (policyholder) submits the application for policy-pledged loan to the bank;

2.      The borrower (policyholder) submits the application information to the processing bank, including but not limited to the identity certificate of the borrower (policyholder), original insurance contract, the identity certificate and written consent of the insured, if the insured is not the policyholder;

Amount of loan

The amount of loan will not exceed 90% of the cash value (amount refunded when the contract is terminated) of the insurance contract to be pledged at the time of application. Cash value (amount refunded when the contract is terminated) means the amount that the insurer should pay the policyholder under the insurance contract when the insurance contract is terminated.

Term of loan

The maximum term can reach 3 years.

Interest rate of loan

The floating proportion of current interest rate of CGB shall be used based on the current benchmark interest rate for loans announced by the People's Bank.

Repayment Method

1.      Repayment Tool

Repayment may be made through Licaitong Card, demand deposit passbook or cash.

2.      Mode of repayment

(1)     Weekly installment;

(2)     Biweekly installment;

(3)     Monthly installment;

(4)     Quarterly installment;

(5)     Semiannual installment;

(6)     Repayment of interest in installments and principal as it falls due;

(7)     Lump-sum repayment of principal and interest as they fall due.