It’s always important that you take time to consider how you will pay off your new mortgage if something unexpected happens to you.
While it’s often tempting to opt for standard mortgage insurance, Amanda Cutten explains many people don’t know that the right life insurance policy can offer this same protection alongside several additional benefits - including:
You name your own beneficiary.
This means that, in the event something happens to you, your beneficiary can decide how the death benefit payment will be allotted. A typical mortgage insurance policy names the financial institution as the automatic beneficiary for the amount due.
You have more choice
When selecting your life insurance coverage limit, you can choose any amount subject to policy limits. Traditional mortgage insurance has fewer options in terms of both the amount of coverage you can choose and the length of the coverage period.
Your coverage does not decrease
Traditional mortgage insurance policies only offer a decreasing benefit for the length of the policy’s term – so just enough to cover the remaining balance of the mortgage itself. A life insurance policy would provide you with the full value of the death benefit – regardless of what you still owe.
You can add additional coverage options
If you opt to protect your mortgage through a life insurance policy, you can take advantage of many additional coverage options. A disability waiver of premiums, for example, is a type of coverage that helps preserve your policy in the event your income is affected by an unexpected disability. Buying a home is a big and often-intimidating process so it’s important to ensure you’re well-prepared.
