Loan insurance will not be considered a primary requisite for approval of any loan. Loan insurance applies to approved 1:2 loans and normal loan processing fee of K25.00 applies. ncsl’s normal interest rate of 12% per annum or the prevailing loan interest rate at the time of the loan approval will also be applicable.

Upon loan approval, the premium for the insurance will be added to the loan amount thereby allowing the member to only have one loan repayment amount. The cost of loan insurance premium varies depending on the amount borrowed and the term given to repay the loan.

For example: a loan of no more than K1,000.00 over a 6 month repayment term –  will attract a premium of K5.40 while a loan between K9,000.000 and K10,000.00 at a term of 12 months will attract a premium of K108.00.

This insurance products is aimed at assisting the member in their time of need during an accident and also will relieve pressure on the loved ones in the untimely event of death.

This insurance product was approved by the Bank of Papua New Guinea in September 2016 and was launched on 1st November 2016.