Mortgage Insurance V/s. Life Insurance: What meets your needs?

 

If you own a home or buying one recently, you may be offered one of these options by your bank or nearby insurance providers. You can put a lot of money towards your home, so it’s equally important to protect the biggest investment of your life.

Mortgage life insurance in canada is suitable for individuals who’ve just bought their home and may be concerned that their unexpected death, disability or illness could become a huge financial stressor for the family and cause them to fall into debt.

A life insurance more or less does the same, however it is just unrelated to covering your mortgage. It’s designed to provide your beneficiaries with benefit after you’re gone. It’s the flexibility that allows them to use it for more than one reason- whether that is everyday expenses, higher education or repaying loans/debts etc.

What is mortgage life insurance?

Mortgage life insurance in canada is coverage that can be purchased as a mortgage borrower. It’s designed to pay the mortgage loan if something unfortunate happens. The insurance money is payable under the coverage amount. If you buy from the bank the amount is equal to the lender’s amount and it decreases as the loan amount is paid off, while the premium remains.

However if you buy the mortgage privately, the coverage amount is permanent and the premiums stay constant to.

An advantage of having mortgage life insurance plan as part of your overall financial plan is that it can free up a lot of money that you can put towards other investment options. It also carries a free 30-day review period to determine whether this is really good for you or not.

Main difference between Life Insurance and Mortgage Life Insurance Policy

Life Insurance application will take a lot more dealing in to your medical history. However when it comes to buying a mortgage life insurance is a simple application process.