What is private mortgage insurance (PMI) and when is it required?

In India, Private Mortgage Insurance (PMI) is not applicable. Instead, the Reserve Bank of India (RBI) has mandated that all banks and housing finance companies obtain mortgage guarantee from an eligible mortgage guarantee company for loans above INR 80 Lakhs. The mortgage guarantee premium is a onetime payment made by the borrower at the time of loan disbursal and is typically around 12% of the loan amount. This guarantee covers the lender against any default by the borrower.