The objective of Mortgage Insurance Protection is to allow you to avoid leaving a significant debt for your surviving spouse and children. It enables your loved ones to keep the house and all the benefits associated with it, rather than having to sell, in the event you suffer from a critical illness or should you pass away prior to repayment of the mortgage loan.
If you currently have or you are contemplating mortgage insurance from a bank or from a mortgage lender please Watch the CBC Video.
Mortgage Insurance is, first and foremost, life insurance coverage that enables you to pay all or part of your mortgage loan balance. Many people may also consider Critical Illness and/or Disability coverage as an added benefit.
Your home is probably the biggest investment you'll ever make. That is why you should ensure that you are properly protected with right kind of coverage to protect your home. When you arrange a mortgage with a financial institution, they ask you to insure your mortgage through them. If you decline they ask you to sign a waiver that in most cases will put that extra pressure on you to buy on the spot. But mortgage insurance from your bank or mortgage lender may not be your best choice. Coverage from a licensed life insurance broker gives you more options and greater control over your mortgage protection. Below is a comparison to allow you to compare our advantages to what happens when your mortgage lender insures your mortgage:
| Mortgage Insurance from Banks and Mortgage Lenders |
Mortgage Protection with a Licensed Life Insurance Broker |
| Your insurance only cover your mortgage balance. |
You can choose from different types of insurance such as term, whole life or Universal Life with a death benefit to cover more than just your mortgage. |
| Your Mortgage debt reduces over time, and your premiums remain level. |
Your coverage amount does not decrease over time unless you choose to change it. Premiums are level and guaranteed for the entire term you are covered for. |
| If you die, only the outstanding balance on your mortgage is paid off. |
If you die, the death benefit is paid to your beneficiary who can use it as they see fit, not just to pay off your mortgage. |
| The mortgage lender is automatically the beneficiary. |
Freedom to appoint your own beneficiary rather than your financial institution. |
| If you move your mortgage to another company, you may lose your existing mortgage insurance and may be required to re-qualify for new mortgage insurance. |
Take full advantage of keeping your insurance, even if you refinance your loan or change lending institutions. Your coverage remains in effect. |
| You lose all your coverage when your mortgage is repaid, assumed or in default. |
As long as premiums are paid your coverage remains in place, even if your mortgage is repaid, assumed or in default. |
| You have no flexibility to change your coverage as your need change. |
If you decide you need coverage only until your mortgage is repaid and you take term insurance but later realize you require coverage for other needs, you have the opportunity to convert your mortgage insurance to regular permanent life insurance without having to answer medical questions. |
| Post Claim Underwriting. The financial institution will complete the underwriting at the time of death. The benefit is not guaranteed at the time of death. |
Pre-Issue Underwriting. Buying from a licensed insurance broker will explore any medical issues before paying for your first premium. |
Isn't it better to own your policy and maintain control over this important protection? Before you sign anything, talk to us about a better way to guarantee the payments of your mortgage in case of death, critical illness or disability.
Wikipedia on Mortgage Insurance
