In the case of an illness which has been diagnosed as fatal within one year, this insurance offers an early payout to help relieve financial concerns. For additional security, the same protection is also available to your co-borrowers or to the guarantor(s) of the mortgage.
Coverage for your mortgage can start on the date your mortgage is approved. This way, you are protected even before your new purchase closes.
If your mortgage is over $500,000, you may be eligible for partial Mortgage Life Insurance coverage.
Differences between a Mortgage life insurance vs. individual life insurance
- Mortgage insurance is very different from individual life insurance because the coverage declines each year or declines as the mortgage declines
- The bank is the beneficiary in mortgage insurance while in an individual life insurance policy, the insured can choose their own beneficiary.
- The coverage is not transferrable. This means that the insurance is tied to a specific mortgage. With an individual policy, the insured can keep their coverage if they move homes, switch banks, or eventually pay off their mortgage.
- The plan ends as soon as one spouse passes away. An individual policy can be set up as a joint policy, meaning a joint or multi-life policy, which allows the beneficiary to receive a double benefit in the event that both spouses pass away.
- The coverage is not convertible. A mortgage life insurance policy is not convertible to a permanent policy, but an individual term life policy is convertible to a permanent plan without a medical. This allows the insured, who may have developed some health issues over the life of the policy, to convert to a permanent level rate plan without any health questions or without any medical tests.
When purchasing your new home, take the time to shop and compare lowest quotes for life insurance. Compare the cost of a term life insurance policy to a mortgage insurance policy. Chances are you’ll find a term life insurance policy will have lower yearly premiums and offer more coverage and flexibility than a mortgage insurance policy. We at Daya Insurance Inc. Offer and assure lowest quotes on term life insurance and mortgage insurance.