For most of us, a mortgage is the single largest financial responsibility we will have in our lifetimes. That’s why it makes sense to protect your mortgage with insurance coverage. Term life insurance is a sensible way to provide the temporary protection you need — and life insurance gives you more options and greater control than the mortgage insurance products available through your bank or mortgage lender.
For example, one of the key benefits of a life insurance policy is that the amount your beneficiary receives doesn’t change was you make mortgage payments. Bank mortgage insurance covers only the mortgage balance, which decreases with each of your payments.
Once you’ve made the decision to protect your mortgage with life insurance, your choices don’t end here.
When two people share responsibility for protecting against the same risk — like a mortgage — they have a choice between the benefits of each obtaining individually-owned life insurance or the benefits of joint life insurance. Both solutions offer advantages.
Individually-owned life policies allow you to:
– Choose a different death benefit.
– Add additional benefits, like a disability waiver, child term insurance, guaranteed insurability and accidental death.
– Name your own beneficiary, now and in the future.
– If your needs change or your partnership ends, you can easily update your coverage without the permission of both partners.
– If you want to convert your term coverage to permanent coverage, your permanent insurance death benefit can be as much as your individual death benefit (the amount is not limited to only half the death benefit, as it is with some joint insurance conversions).
A joint life policy allows each of you to:
– Benefit from the reduced cost of a joint policy
– Combine life, disability and family protection in one policy by choosing to include a disability waiver benefit and child term insurance.
– Protect against a joint risk with a joint product.
– If your needs change you both have the option to convert to joint permanent insurance (up to the original joint coverage amount).
– If your partnership ends you both have the option to convert to individual permanent insurance (up to half of the original joint coverage amount).
– If you or your partner dies before age 65, the Survivor benefit allows the surviving partner to purchase individual coverage (up to the full amount of the original joint coverage) without providing new medical evidence.
Whether it’s a joint policy or individually owned policies, each option has its own benefits and offers a choice of features to meet different needs. I can help you make the mortgage protection decision that’s right for you.