What is Heir’s Bond in Bank Home Loan?

An HEIR’S BOND is a financial guarantee. It is required by lending banks when the Spouse of the Owner of the collateral house and lot is Deceased. Or if the Title has an annotation of Section 4 of Rule 74 of the Rules of Court.

Bago kayo bumili ng property from an Individual Seller using a bank loan or Pag-ibig loan, tanungin nio muna kung kaninong pangalan ang nasa Title, kung married, at kung parehong Buhay (Living). Kapag ang owner ay Deceased na, or kapag ang spouse ng Owner ay Deceased na, mas magasto at mas matagal ang processing. Isa dito ang pagbili ng Heirs Bond. As of May 2024, around 20,000 pesos ang Heirs Bond for a 2 million-peso loan. At hindi lang basta-basta ang pagbili. Maraming required documents, katulad ng co-signers (not relatives), at kelangan ang latest ITRs nila or certificates of deposits.

The Heir’s Bond will protect the lending bank from loss in case legitimate heirs or unpaid creditors have been excluded from the settlement of the Deceased’s property, which was used in the home loan as collateral. And these heirs win their lawsuit to claim their share of the property.

An Heir’s Bond (or Heirs Bond) is an agreement among 3 parties:

  • the insurance company which issues the bond and will pay court-declared valid claimants
  • the home loan borrower who pays the bond
  • the lending bank that gives the home loan

The borrower is called the Principal or Obligor; the lending bank is called the Obligee or Bond Beneficiary.

Warning! Before you buy an Heirs Bond, ask your lending bank if the insurance company you are planning to buy from is Acceptable to them.

How much is Heirs Bond?

About 1% of the home loan amount. For a 2 million-peso home loan, the heirs bond cost is around 20,000 pesos. The quotes I got from several of the following do not differ much. Mga few hundreds lang ang difference.

Ang tingnan na lang is yong requirements. Yong iba nagre-require ng document na medyo mahirap kunin.

Utimately, BPI MS ang pinili namin, kasi BPI ang nagbigay sa amin ng the most favorable interest rate and processing cost for our home loan application.

BPI MS Insurance (owned by the Bank of the Philippine Islands and Mitsui Misutomo Insurance of Japan)

Website: bpims.com

Requirements:

  • BPI Heirs Bond for Loan
  • BPI MS Individual Information Sheet
  • Deed of Extra Judicial Settlement or Self-Adjudication
  • Certificate of Publication of the Deed of Extra Judicial Settlement or Self-Adjudication
  • Death Certificate of the deceased person whom the property is inherited
  • Loan Approval
  • Old Title
  • New Title
  • Deed of Absolute Sale (if there was a sale of the property used as collateral for the loan)
  • IDs of borrower and all heirs and co-signers and spouses, if applicable (photocopy on bond paper and 3 signatures)
  • Proof of heir’s relationship with the deceased:
  • Submit what is applicable:
    • Marriage certificate
    • Birth certificate of deceased
    • Birth certificate of child/children
    • Certificate of No Marriage of the Deceased (if not married)
    • Death certificate of deceased’s parents and/or siblings (if heirs are siblings and nephews/nieces)
    • Birth certificate of deceased’s siblings and/or nephews/nieces (if heirs are siblings and nephews/nieces)

AXA Philippines

Website: axa.com.ph

Requirements:

  • AXA Client Information Sheet
  • Co-signer Statement Form (at least 2 co-signers)
  • Co-signers’ latest ITRs, or certificate of time deposit from Metrobank
  • AXA Indemnity Agreement
  • Deed of Absolute Sale
  • Extrajudicial Settlement of Estate or Affidavit of Self-Adjudication or Deed of Partition
  • Affidavit of Publication of Extrajudicial Settlement of Estate or Affidavit of Self-Adjudication or Deed of Partition
  • Death certificate of Deceased
  • Proof of relationship of heirs: Marriage certificate for surviving spouse, birth certificate for children or siblings of deceased
  • Bank’s Appraisal Report
  • At least 2 valid government-issued IDs

Commonwealth Insurance Co.

Website: cic.com.ph

  • Duly accomplished Bond Application form, co-signer’s statement & employer’s Statement together with the copies the latest ITR’s of the signors.
  • Copy of Extra-Judicial Settlements/partition among heirs
  • Copy of Death Certificate
  • Affidavit of Publication and proof of Publication
  • Copy of Title and/or Bank Book
  • Note: ALL the heirs of the deceased should sign the Indemnity Agreement (including their spouses).

The Premier Life and General Assurance Corp.
(formerly The Premier Insurance & Surety Corp.)

Website: premierlifeandgen.com

  • Bond application with 2 valid xerox ID with specimen signature
  • AMLA
  • Co-signer’s solvent with ITR and 2 copies of xerox valid ID with specimen signature
  • Extrajudicial partition or Settlement
  • Notice or Affidavit of Publication for Extrajudicial (3 consecutive weeks)
  • Waiver of Rights, if applicable
  • Title of property
  • Death certificate
  • Marriage Certificate
  • Birth certificate
  • Indemnity Agreement

Standard Insurance

Website: standard-insurance.com

When I called them, they instructed me to go to their branch nearest my residence. They have 14 branches in Metro Manila, 34 in Luzon, 10 in Visayas and 12 in Mindanao.

Prudential Guarantee Insurance Inc.

Website: prudentialguarantee.com

AlliedBankers Insurance Corp.

The non-life insurance company of the Lucio Tan Group and the non-life insurance product provider of PNB Bancassurance.

Website: alliedbankers.com.ph To request a quotation, kindly email sales@alliedbankers.com.ph

FPG Insurance

Requirements:

  • Deed of Extra-Judicial Settlement or Self-Adjudication  
  • Certificate of Deposit/s with Account Number  
  • Publisher’s Affidavit of Publication of Deed of Extra-Judicial Settlement or Self-Adjudication  
  • Death certificate of the person whose estate is for distribution
  • Certificate of No Marriage (CENOMAR), if the deceased is single  
  • Proof of filiation to the decedent of the applicant such as Marriage and Birth Certificate  
  • Latest ITR of the applicant/s, payslip or source of living if unemployed  
  • 2 valid IDs of all heirs  
  • Completed, dated and signed Bond Application Form and KYC Form  
  • 2 co-signer’s with 2 valid ID’s and latest ITRs 
  • If you have an existing FPG Insurance account, please provide ANY of the following information:
    Policy Number and Assured Name

Website: ph.fpgins.com

FPG Heir’s Bond Application Form

Liberty Insurance Corp.

Website: libertyinsurance.com.ph

Travellers Insurance Surety Corp.

Website: triscoph.com

Since 1964. Info on Heirs Bond

Alpha Insurance & Surety Co.

Website: alphainsurancesurety.com

Cocogen Insurance Inc.

Website: cocogen.com

Requirements:

  • Deed of Extra Judicial Settlement or Affidavit of Self-Adjudication
  • Editors’ Affidavit of Newspaper Publication for 3 consecutive weeks
  • Death Certificate
  • Tax Clearance /Tax Receipts from BIR
  • Marriage Contract
  • Cocogen Application Form, signed by applicant and 2 co-signers with their respective ITRs and photocopy of any government-issued ID
  • Photocopy of declared properties of co-signers
  • Copy of the Title
  • Birth Certificate (If the surviving heirs are children of the deceased)
  • Special Power of Attorney ( if applicable)
  • Deed of Absolute Sale
  • Appraisal Report

Western Guaranty Corp.

Website: westernguaranty.ph

GSIS (Government Service Insurance System)

Website: gsis.gov.ph

Ask your lending bank if it accepts a GSIS Heirs Bond. Baka puede lang ang GSIS Heirs Bond sa Pag-ibig home loan o sa bond requirement ng Register of Deeds. Hindi ko rin sure kung nag-a-accept ang GSIS ng Heirs Bond application for a home loan, kasi itong list of requirements nila is for bank account. But somebody on reddit philippines suggested GSIS in reply to someone asking about heirs bond for a home loan.

Latest ranking of non-life insurance companies that offer Heirs Bond

Ranking based on net worth as of December 2023, as published by the Insurance Commission:

RankNon-Life Insurance CompanyNet Worth
4Standard Insurance4.39 Billion
5Prudential Guarantee Insurance 3.9 B
6 Travellers Insurance3.29 B
7Commonwealth Insurance3.22 B
8BPI/MS Insurance3.19 B
10Premier Life and General Assurance3.11 B
11Alliedbankers Insurance2.83 B
17FPG Insurance2.22 B
18Liberty Insurance2.10 B
19Alpha Insurance2.06 B
20Cocogen Insurance Inc.2.03 B
26 Western Guaranty Corp.1.67 B
38 Charter Ping An Insurance *1.42 B
RankLife Insurance CompanyNet Worth
6Philippine AXA Life Insurance Corp.*11.23 B

Note: In the above table, I included just the insurers whose websites included Heirs Bond in their product list. Baka merong insurer na hindi ko na-include, pero nag-o-offer naman sila ng Heirs Bond.

* The merger of AXA Philippines (life insurer) and Charter Ping An Insurance (non-life insurer) was completed in March 2023. AXA acquired Charter Ping An in 2016.

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