life vs mortgage insurance top image

A life insurance policy makes good sense. Unlike conventional mortgage insurance where the bank is the beneficiary, a life policy allows you to name the beneficiaries. Making it easy for your loved ones to continue paying the bills and direct other funds where they are needed most. That’s just one good reason to make the switch, but consider this:

Life Insurance

  • You choose the type of policy you need, coverage and amounts.
  • Your premiums and benefits are guaranteed for the life of the policy as long as premiums are paid.
  • Premiums are tailored to you, based on your age, health and smoking status. Very healthy individuals may even benefit from preferred rates.
  • Underwriting is done at the time of application. This means once approved, your coverage is guaranteed.

Mortgage Insurance

  • Only covers mortgage amount and coverage ends at age 70.
  • Benefits decrease as the mortgage is paid down, but premiums remain the same, and paying off the mortgage forfeits all coverage.
  • Premiums are based on group rates. Smokers and non-smokers alike are grouped together by age group.
  • Mortgage insurance uses Post-Claim Underwriting. This means medical history is not checked at the time of application, but after a claim is made. This could disqualify coverage after the fact.

But what about the cost?

Life Insurance vs. Mortgage Insurance

*Combined premiums based on 35  year old non-smoking couple, 20 year term
**Mortgage value based on $500,000 at 3% over 20 years

Your mortgage payment is typically one-third of your income. What will replace the other two-thirds?

Making the switch is easy. Let’s talk about the options that are right for you.

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