Your home may be your family's largest asset. And their largest financial responsibility. Term life insurance can help them remain in your home after you're gone. Mortgage life insurance.
Perhaps the simplest of all life insurance types, term life insurance is designed for:
Coverage for a specific period of time
Mortgage protection insurance
Purchase a term life insurance policy for at least the amount of your mortgage. Then, if you pass away during the "term" when the policy’s in force, your loved ones receive the face value of the policy. They can use the proceeds to pay off the mortgage. Proceeds that are often tax free.
Life insurance estimate
Actually, the proceeds from your policy can be used for any purpose your beneficiaries choose. If your mortgage has a low interest rate, they may want to pay off high-interest credit card debt and keep the lower-interest mortgage. Or they may want to pay for home maintenance and upkeep. Whatever they decide to do, that money will come in handy.
Use our life insurance tool to help you get an estimate of the amount of coverage you may need, and how much a mortgage life insurance quote could cost.
Term life insurance vs. mortgage life insurance
Both term insurance and mortgage life insurance provide a means of paying off your mortgage. With either type of insurance, you pay regular premiums to keep the coverage in force.
But with mortgage life insurance, your mortgage lender is the beneficiary of the policy rather than beneficiaries you designate. If you pass away, your lender is paid the balance of your mortgage. Your mortgage will go away, but your survivors or loved ones won’t see any of the proceeds.
In addition, standard term insurance offers a level benefit and level premium for the term of the policy. With mortgage life insurance, the premiums may remain the same, but the value of the policy decreases over time as the balance of your mortgage declines.
For more information, talk to your insurance professional about using term life insurance to pay off your mortgage after you’re gone.
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