Mortgage Insurance

Life Insurance Cover Quote, Do you think that with such an easy ‘tacked on’ sale, the banks are giving you anything close to the best value or rate? Recall the pressure to sign up for the mortgage insurance.

Below you can review and compare 11 important reasons to have private mortgage insurance.

To obtain instant mortgage insurance rates, complete the following form selecting a 10 year term policy for the amount of your mortgage and do a quote for both you and your partner. Take about $3 off the combined quote as there is a discount for mortgage insurance for couples.

Bank mortgage insurance is not guaranteed if you change mortgage providers.

Are you surprised to learn the above? Does any of this cause you concern? One of the key points that many miss is the fact that the bank mortgage insurance is frequently not guaranteed renewable when you renew your mortgage. One person we know found this out the hard way. Her husband suffered a heart attack and when they renewed their mortgage she claims she told the person doing the paper work of her husband’s heart attack. She was asked to sign here and initial there – most people have experience this with a bank.

When he died four months later the bank investigated and declined the coverage stating that she had signed that there had been no change in her or her husband’s health – one of those initials she was asked to do. However, had the person doing the application heard her comment or if she had read what she was signing and not signed, then the bank would not have issued the insurance in the first place so either way her husband could not get insurance. Had he been covered privately, first he would have had his rates guaranteed for 10 or more years depending on the term and he was also guaranteed to be able to renew the policy regardless of his health but for a higher premium. Which insurance do you want?

So having determined that you want a private mortgage insurance policy, there are several alternatives. The primary one is term insurance where the monthly premiums are guaranteed for a fix period of time, 10 or 20 years are the most common, but longer terms are available. If you purchase a 10 year term policy, then in ten years, we will broker a new policy to cover the balance of the mortgage. If you still have your health, we can usually do it for about what you are paying for the first ten years as the principal to cover is less having paid some of it off. If you are no longer insurable, then the guaranteed renewal rate is quite high as they assume the only reason you would renew is because you are uninsurable but at least you can still purchase it. Interestingly, many people just end up renewing without first getting a new quote/ policy which could save them hundreds of dollars. Find your mortgage insurance rate

Those who do not want to take the risk of being uninsurable in 10 years and having to pay a significantly larger premium on renewal opt for a 20 year term which will usually see their mortgage essentially paid off. They pay 25% to 35% more in the first ten years for this security.

Some people also will purchase a small critical illness policy as part of their mortgage protection insurance plan which will pay a lump sum if they contract a critical illness. Purchase enough to at least cover the mortgage payments for a year and help with extra expenses such as the spouses lost wages if they take time off work and travel costs including parking. Normal amounts are about $50,000 for this purpose.

If you do not have disability coverage at work, some clients will purchase a mortgage disability policy for the amount of the monthly payments including taxes. The coverage is significantly better than traditional bank group insurance. There are a number of ways to keep the premiums down.

We also have access to a private mortgage insurance policy that offers critical illness and disability insurance as part of the package. It is well priced and is available for those under the age of 50. Complete the above form and we will send you information on how this could benefit you.

So what does all this mean to you? It is simple, let the mortgage broker do what their specialty is and then say “no” to the offered insurance and turn to an expert in life insurance to provide you with the best brokered solutions to meet your particular personal insurance needs. At IDC Insurance Direct Canada we specialize in helping our clients get the best possible mortgage insurance coverage for their budget and risk tolerance.