Mortgage vs Life Insurance
If you’re wondering what mortgage insurance is and how it’s different from the insurance offered through your mortgage letter, this page will help!
Mortgage insurance is life insurance taken out with the main purpose of covering off your mortgage debt. Personally-held insurance means that the policy is owned by you. It’s not connected to your mortgage or the lending company. There are many reasons why it’s better to purchase your own mortgage life insurance rather than accept what’s offered as part of your mortgage contract.
Coverage and Availability
When you own your own term life insurance, the death benefit will stay the same during the entire policy. It will not decrease as you pay down your mortgage.
Choose Your Beneficiary
spoiler alert: it won’t be the bank! With your own policy, you can choose who gets the death benefit. In the event of death, the money goes to them. This means they can put it towards the mortgage if they want. It also means they can use it for bills, groceries, property taxes, etc.
When you own your own term life insurance, the coverage stays with you as long as you pay the premiums. So if you pay off your mortgage, or renew it and switch to a different lender, you are still covered. You don’t have to requalify with your health or pay higher fees.
How Much Does Mortgage Insurance Cost in Canada?
Mortgage insurance prices are based on:
- Number of person(s) insured
- Smoking Status (nicotine)
- Amount of coverage (death benefit)
- Length of coverage (number of years, sometimes called term length)
There are a number of factors that come in to play and it can be hard to compare one quote from another.
Compare Your Current Rate
Are you interested in comparing your current mortgage product to see if there is a better option?
A mortgage insurance consultation from Dickson Insurance does not cost anything (just your time)!