Protecting your Family with Life Insured Mortgages

You've invested a lot in your home. Fire and theft insurance covers the contents. What about protecting the people who live there, your family, with mortgage life insurance? This type of term insurance is available through most financial institutions. When the unexpected happens - make sure your home remains your family's home. Have the comfort of knowing that the amount you owe will be paid and your family can live mortgage-free.

Eligibility
If you are between the ages of eighteen and sixty-four, and are the registered owner, spouse or guarantor of a residential first mortgage you probably qualify for mortgage life insurance. One or two people can be insured on each mortgage. If you do not meet the age requirement, your spouse or guarantor can still apply.

Coverage
Coverage starts on the date that you assume the mortgage. With an existing mortgage, coverage begins on the date of approval. Most financial institutions will insure up to two mortgages for the same customer. The life insurance covers the mortgage balance, at the time of death, up to three hundred thousand dollars per mortgage. Coverage ceases either when the mortgage is paid in full or if you sell the property. It will also cease if the premiums are three months in arrears or if you cancel the policy in writing.

Cost
The costs are determined by your age and the amount of the mortgage. Protection is available for either single or joint coverage. When two apply jointly the cost, based on the older applicant's age, is only slightly higher (1.4 time) than the cost of single coverage. For instance; a person forty years of age, with a mortgage of $ 82,000, could have a monthly payment of about $ 14.76. By adding a spouse the same coverage would be $ 20.50 monthly. Premiums do not increase due to age and will remain the same for the life of a mortgage.

Application
To apply you fill out a short application at your financial institution. If you can provide a "no" response to the three health status questions, coverage is automatic. In some instances, you may be required to provide additional information to the insurance company. If so, any further communication will remain confidential. In other words that information will not be shared with your financial institution or anyone else. Once insured, no further medical evidence is required to keep your coverage, regardless of any changes in your health, and you will be issued a certificate as proof of insurance.

Flexibility
If you decide at a later date to add your spouse to the insurance, he or she may apply for the insurance by filling out the health questionnaire. The premium will be based on the age of the older applicant and the current balance of the mortgage. If you decided to finance renovations to your home by adding to your existing mortgage, you would re-apply for insurance on the new amount following the original procedures.

Peace of Mind
To decide if mortgage life insurance is for you, do some comparison shopping, ask questions about rates and options. You've invested a lot in your home. Now, invest in peace of mind.

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