Mortgage, Critical Illness Insurance: Bank or Life Insurance Company

Your home may be the single largest investment you will ever have so, naturally, you will want to protect it. Your bank will offer you mortgage insurance but is that your best option? Call our Advisor to find out what is best for you. 

Your house… your policy

Did you know that if you get life insurance covering your mortgage from a bank where you have your mortgage that you do not actually own the policy? The bank holds the contract with the insurance provider. What that means is that the bank is beneficiary of the policy. 

Should something happen to you, the death benefit from the life insurance policy gets paid to the bank, not you. They do pay off your mortgage but can keep the rest.  With your own life insurance policy, you own the policy and can decide who you would like to have as a beneficiary.

In addition, if you sell your house and move, the life insurance goes with you because it belongs to you.

Thanks,

Reasons why you should get your life insurance though a life insurance company and not a bank for your mortgage: 

Bank

• Policy is a group policy, client has no control
• Policy is owned by the bank
• Coverage equals outstanding mortgage amount
• Policy can be cancelled by the bank and the group underwriter
• Money is paid only to the bank
• Policy is non-transferable to another bank
• Policy is not convertible to another form of insurance policy
• Very few additional benefits can be added
• Premiums are not guaranteed
• Policy is underwritten at claim

Life Insurance Company 

• Client enjoys complete control
• Policy is owned by the client
• Coverage need not decline with mortgage
• Policy can only be cancelled by the client (unless premiums are not paid)
• Money is paid to the beneficiary
• Policy is fully transferable
• Policy is fully convertible
• Benefits and options are available
• Premiums are fully guaranteed
• Policy is underwritten at issue