What’s the difference between Mortgage Insurance and life Insurance?
When you buy your new home it would be the most important asset of your life. As we know, buying a new house in nowadays expensive market is very complex and it needs big capital. The average cost of home is about $1,000,000 in Ontario. Most of us apply for mortgage and we need to pay our mortgage on time up to minimum 20 or 30 years. In case of death of mortgage payor, family member needs to cover the cost of mortgage as well as home and now this is the time when life insurance protects us.
When you apply for mortgage your bank askes you for mortgage life insurance to insure the mortgage after death of homeowner. There are some differences between mortgage Insurance the one Bank requires you to buy or Term life insurance which you can buy yourself from your insurance broker and we explain the main ones in here.
- The beneficiary in Term Life Insurance is your family but in Mortgage Life Insurance is your bank.
- The coverage in Term life insurance ends based on your choice when in Mortgage Life Insurance ends when your mortgage paid off.
- Term Life Insurance stays with you even when you move to different location, but Mortgage life insurance ends when you cancel your mortgage and apply new one when you move to new location.
- Mortgage life insurance only pays the remaining balance of mortgage when Term Life Insurance pays full amount.
- Your Mortgage life insurance payment never changes even when the balance of your mortgage goes down during the time.
CONTACT SHAWN SHIRDARREH TEAM INSURANCE TO CHOOSE THE RIGHT LIFE INSURANCE TAILOR TO YOUR NEEDS.