5 Tips on Awareness of Mortgage Insurance
Mortgage insurance is a private insurance that home owners are encouraged to get from their lending institutions. It is meant to pay off your mortgage in case you die. Basically mortgage insurance insures your lender/bank.
Of course this sounds like a great product when you are first applying for your mortgage however an Individual Life Insurance Policy is a much better choice to cover both your mortgage and more in case of death.
1. Life Insurance is Cheaper. Mortgage insurance is usually 50% more expensive when comparing it to a term 20 life insurance policy.
2. Mortgage Insurance has Declining Coverage. Mortgage insurance coverage declines as you pay down the mortgage, life insurance coverage remains the same for the duration of the term.
3. With Mortgage Insurance, the Bank is the Beneficiary. Upon death the mortgage is paid off to your lender. With life insurance, you choose the beneficiary and they decide what to do with the death benefit.
4. Mortgage Insurance is Not Convertible. With an individual term life policy, you can convert it to a permanent plan without a medical.
5. Mortgage Insurance Doesn’t Always Pay Out. With mortgage insurance, the lender does the medical underwriting post claim so when it comes to paying out the claim, there is lots of room for questions to be raised. Take a look at the following link for more info. https://lifeman.ca/the-real-deal-on-mortgage-insurance/
For more details on mortgage life insurance versus individual life insurance, please contact Jack Bendahan at 905-761-9986 or 416-995-8705 or visit www.lifeman.ca for a free quote.
Posted by Jack Bendahan