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Mortgage Protection Insurance

Why Choose Mortgage Protection Insurance

Protecting your mortgage with insurance is a smart financial move. Mortgage protection insurance is one of the many things to consider as a home owner. We can help you understand your options. 

Your home is your most valuable asset. Also, your most expensive investment. Insurance to protect your home is a good idea. After all, you insure your car and perhaps you even insure your life, don’t you? In the event of a disaster or catastrophe, an insurance policy may be the only thing standing between your family and complete devastation.

Of course, the question is – how to insure your home? Only you can answer that question. We can guide you but your specific circumstances dictate the outcome. Naturally, there are pros and cons to purchasing mortgage protection insurance.  Is it necessary for you to have optional mortgage insurance?

What Is Mortgage Protection Insurance?

Generally speaking, there are two types of mortgage protection insurance. First, we will discuss critical illness.  This can be used to subsidize some (or all) of your monthly mortgage expense. In the event that you were to lose your job, become disabled or are unable to work, this type of insurance helps ensure that your mortgage does not fall behind. 

Comparatively, the second type of mortgage protection plan can cover you in the unlikely event of death. Mortality is a fact of life. And for those of us with family to take care of, what happens after we die matters a lot. In the event of an untimely death, this type of mortgage protection insurance can pay off the remaining balance of your mortgage. Your family will inherit your asset unencumbered. This means they won’t have to worry about how to make mortgage payments without you.

Is Mortgage Insurance Right For You?

Mortgage protection has its ups and its downs. Mortgage insurance may not be right for every homeowner. Before you purchase a mortgage insurance policy, it is important to weigh the pros and cons. To do this effectively you must consider your specific circumstances. We can help you understand the highlights and the downsides of paying for coverage.

One of the considerations you might make is how long you’ve amortized for, how soon you expect to sell your home and whether or not you’ve agreed to a fixed rate or a variable rate mortgage.

Mortgage Protection Insurance – The Highlights

Approval rates: Approval rates tend to be very high with mortgage protection insurance. Less scrutiny is placed on your age and pre-existing medical conditions. You likely won’t be required to submit to a medical examination like you would to qualify for many life insurance policies.

Low premiums: You’ll only be insuring the amount of the mortgage you’ve borrowed, and that amount will be paid down over time. So, premiums to secure mortgage protection coverage can be lower than the premiums you’d pay for life insurance. If you’ve had trouble qualifying for an affordable life insurance policy, this could be a solution. It may help protect your biggest asset at the very least.

Peace of mind: Most people hope they will never need to use their life or disability insurance. However, cashing in on a policy happens more often than one might think. A workplace injury, unfortunate accident or natural disaster could result in the need to call in that insurance policy. Knowing that you and your family won’t have to stress over finances in the event of misfortune will ease your mind.

Mortgage Protection Insurance – The Disadvantages

Diminished value over time: Mortgage protection insurance is most useful while the balance of your mortgage is high. The higher your balance, the larger the payout.  When an insured party passes on, the remaining mortgage balance gets paid by the insurer. As you pay down your mortgage over time, the balance to be paid decreases.

Mortgage protection insurance is similar to the new vehicle replacement coverage in an automobile policy. As the payout value diminishes, you may choose to cancel your premiums. Once your mortgage balance has dropped low enough you can cancel your insurance policy. 

Never needing to use it: Mortgage protection insurance protects your home from foreclosure or a forced sale if something happens to you. Having some form of insurance means not having to worry if the unexpected occurs. However, if nothing ever happens, (as with all insurance policies) you’ll still be spending all of that money on premiums.

How To Apply For Mortgage Insurance

Mortgage protection can be acquired from a variety of insurance providers.  Mortgage lenders, mortgage brokers, and insurance agents all offer a wide range of policies. Each policy can vary dramatically both in price and the features it includes.

While insurance coverage is never a guarantee, it is free (and easy) to apply. Qualifying factors can include age and health. Depending on the policy, there may be other criteria that you must meet. As with any insurance coverage, the higher the risk you represent to the insurance company the higher your premiums will be. Conversely, the less risk you represent the lower your premiums will be.

The Mortgage Brokers Network Advantage

To sum up, when it comes to mortgage protection insurance, we have your best interests in mind. Just like your mortgage, we want to find the right insurance product for your needs. We don’t believe in selling you something that doesn’t suit your purpose.

Finally, our common-sense approach to everything we do helps you get you the coverage you need. To make sure you are getting the best mortgage protection insurance for you, start with the brokerage with decades of experience. Contact us to review your options free of charge

Find out why Canadians choose the Mortgage Brokers Network

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Term Posted Rate Our Rate Claim This Rate
Home Equity Line of Credit Prime +1% Prime +.50% Claim Rate
Fixed 1 Year 4.50% 3.09% Claim Rate
Fixed 2 Year 4.65% 3.39% Claim Rate
Fixed 3 Year 4.65% 3.79% Claim Rate
Fixed 4 Year 4.65% 3.99% Claim Rate
Fixed 5 Year 4.89% 4.14% Claim Rate
Variable 5 Year 5.80% 3.2% (prime -.95%) Net Rate 2.25% Claim Rate
Fixed 10 Year 5.90% 4.54% Claim Rate