Do You Need Life Insurance and Mortgage Protection?
To begin let define what mortgage protection insurance and term life insurance is.
It covers your monthly mortgage payments if something should happen to you. It protects your living relative from having to sell the house once your income is lost. Buying mortgage protection is an option.
Term life insurance covers you for a certain time period. For instance you may have a term life insurance policy for 35 years. After 35 years you no longer have life insurance coverage.
Term Life Insurance vs Mortgage Protection
Mortgage protection insurance is a type of term life insurance. They basically operate in the same way. You purchase a policy for a certain time period, pay the monthly premiums, and if you die, the death benefit is paid to your beneficiary.
Differences Between the Two Type of Insurance
Mortgage protection will only cover the cost of your mortgage. The money will be paid directly to your lender. Term life insurance will cover every expense you have up to your coverage limit.
One side note….mortgage insurance is based off the balance of your mortgage, so chances are your premiums will stay the same. Mortgage insurance is generally more expensive as well because applicants do not have to take a medical exam.
When Should I Buy Mortgage Protection Insurance?
If you have poor health and are unable to qualify and pass the medical exam for term life insurance, buying mortgage protection insurance would be wise. Even though no-medical life insurance is usually more expensive than term life insurance, so considering MPI could work in your favor.
Shopping for Mortgage Protection Insurance
Here are a few steps to take to ensure you receive the best MPI Insurance.
– Get term life insurance quotes even if you think it is to expensive.
-Shop around for MPI providers, you will want the best deal for your coverage
-Do a google search on your prospective insurers. Check if there are any complaints or what the reviews say
-Be cautious of offers that seem to good to be true ,generally they are.
The bottom line: if you currently have life insurance but are in poor health, additional mortgage protection insurance will ensure your loved ones will be taken care of financially.