Mortgage protection life insurance is a specialized use of life insurance designed to safeguard your family’s home in the event of your death. This policy is tailored to cover the outstanding balance of your mortgage, ensuring your loved ones can remain in their home without the burden of mortgage payments.
Key Features
Fixed Premiums: Your premium payments remain consistent throughout the policy term
Fixed Coverage: The payout remains the same for the life of the policy.
Direct Payout to Family: Upon the policyholder’s death, the insurance company pays the benefit directly to the family, not to the lender, allowing the family to choose how best to use the benefit.
Living Benefits Most policies include an advanced paid benefit for things like critical illness
Term Length: The policy term usually aligns with the length of your mortgage, commonly 15 to 30 years.
Advantages
- Peace of Mind: Ensures your family can keep their home if you pass away.
- Easy Qualification: Often requires no medical exam, but simple medical questions – often with instant approval.
- Simplified Process: The direct payout to the family offers options matters for your beneficiaries.
Critical Period Coverage
When full coverage for the mortgage is too costly, there is available coverage for the mortgage payments for the critical period immediately after death (often from 6 months to 2 years) allowing the family to process their grief and make long term decisions.
