I came across a fantastic article on mortgage life insurance versus life insurance this week, and thought I’d share it with you. As a mortgage broker, I’m mandated to offer all my clients mortgage life insurance, and this article explains the pros and cons of mortgage life insurance versus life insurance.
[box]Mortgage Life Insurance: Why I Passed
The concept behind mortgage life insurance is a good one. It protects your family against unexpected illness, accident, or death.
Mortgage life insurance is the one financial product that goes down in value as you continue to pay, yet this is promoted as a benefit. The marketing material says: your premiums will not increase for the term of your mortgage, even as you get older. It’s comforting to know that this important coverage will remain affordable.
But that also means that relatively it costs more over time. As the mortgage principal decreases the cost stays the same. That’s called a declining benefit…. Read the rest of the article here.[/box]
