The decision to take out life insurance is most commonly triggered by a major life event. In this article, we will discuss how a mortgage can affect your needs for life cover, the differences between mortgage protection life cover and a family income benefit, and how they can complement each other. It’s usually at a key moment in our lives that the need for life insurance is heightened – particularly when we take on greater responsibility, such as the costs involved in buying a home or having a child. Something that every mortgage borrower needs to consider is what will happen to their property if they were to pass away. This is especially important if you are buying a home with a loved one...
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Mortgage life insurance: weighing the pros and cons Is mortgage life insurance the best product for your need? If you have a mortgage, it is highly recommended that you provide protection for that mortgage through life insurance. Mortgage Life Insurance is a product that is designed to specifically protect your family from the heavy payments required in a mortgage in the event that you pass away. Since mortgage life insurance is a product specifically designed for the need to cover a mortgage, it has its own benefits and disadvantages. It will do you good to weigh the pros and cons before deciding to get the mortgage protection life cover that you need for your particular situation and...
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Since the inception of insurance, its main aim has been to transfer risk, which eliminates the anxiety of potential loss. When you purchase life insurance, you are planning for your family’s well-being when you’re gone. You don’t want your family to have to uproot their lives and adapt living standards, because you are no longer there. There are important benefits attached to having a life insurance policy, some of which I will discuss with you here. If your pay cheque is an important part of seeing your family through the month, life insurance is no longer optional. It replaces your income if you should pass away, which is extremely important for parents of young children. Your spouse /...
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Click here to download a free product guide MORTGAGE LIFE INSURANCE Mortgage Life Insurance is designed to provide for your families financial protection; to ease the burden on a family when the unthinkable happens. This benefit will help the survivors with paying off the home, debt, taxes and or any outstanding bills the family has to settle. Deciding to buy a home is one of the most exciting – and most expensive – purchases you will ever make. Although it may be a huge expense, the house you buy will become “home” to your family and will be a place where you create and share a lifetime of memories. It is never too early to begin protecting something so special for the people who mean the...
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With mortgage life insurance cover, in the event of the mortgage holder passing away, the outstanding mortgage will be paid off. When you pick up the keys to your new property nobody is thinking about what would happen to their home if the worse should happen and they were to pass away before the mortgage had been repaid. Given the amount of money that is borrowed under the terms of a mortgage failure to consider what would happen in this eventuality could have implications for your family or spouse. This could ultimately result in the repossession of the property if your loved ones were not in a position to make the mortgage repayments without you. Mortgage life insurance – also known as “...
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Why do I need life insurance for my mortgage? For nearly everyone, buying a home is the single biggest financial commitment you will make. At the start of your mortgage, you will owe your mortgage lender for anything up to 100% of the purchase price for your home – most likely amounting to tens or hundreds of thousands of pounds. With capital and interest mortgages, each month you pay off a little of your mortgage until, at the end of your mortgage term, you have repaid the lender and now own the property outright. However, what happens if you die before you pay off your mortgage? If you have a joint mortgage and die without life insurance in place to cover your mortgage then, the bank will...
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And with these neat little phrase hundreds (if not thousands) of people instantly feel compelled to make an inefficient purchase (I won’t say “dumb”) every day. If you’re a shareholder of one of Canada’s major insurance companies or Big Six Banks then these words are responsible for making you a nice tidy profit on a product with a ridiculous good profit margin. Buzzwords Much? Mortgage insurance does seem like a great idea on the surface. The emotional pull of “taking care of your loved ones if tragedy strikes” is quite persuasive. Emotion shouldn’t trump logic however. Yes, it is good that you want to take care of your loved ones. It is...
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Mortgage life insurance, Term life insurance, What is it? Mortgage life insurance is an insurance policy that pays the balance of your mortgage if a person listed on the mortgage dies. Term life insurance is a policy that provides coverage for a fixed number of years (e.g. a Term 10 is a 10-year policy) or a set age (e.g. Term to 100 offers coverage until you turn 100-years old.) If the person insured dies during the term, then the beneficiary listed will receive the death benefit. When is the policy underwritten? Some mortgage life insurance policies are underwritten at the time a claim is made (this is called post-claim underwriting) leaving a chance that your claim could be denied. Term...
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Do You Need Mortgage Protection Insurance? Buying a home is a major financial commitment. Depending on the loan you choose, you might commit yourself to 30 years of payments. But what will happen to your home if you suddenly die or become too disabled to work? Mortgage protection insurance can help your family cover your mortgage under certain circumstances – you can avoid foreclosure if you can no longer work to pay your mortgage. Let’s take a closer look at what MPI is, what it covers and who might need a policy. What Is Mortgage Protection Insurance? MPI helps your family make your monthly mortgage payments when you die. Some MPI policies will also offer coverage for a...
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Did you know that if you have a product from your financial institution, there is no cancellation penalty or fee. Here are the advantages of purchasing an individual brokerage product rather than a mortgage life insurance product offered by your financial institution. An individual contract is less expensive, it protects you and allows you to choose an individual or joint life insurance protection, depending on your personal situation. Less expensive because the premium of your coverage for mortgage insurance is added as a percentage of your loan. Protects you against an increase in interest rate because the premiums are uniform for the whole term. Allows you to enjoy an appreciable premium...
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