Your home is probably the biggest investment you'll ever make. When arranging a mortgage, your mortgage company may offer you mortgage insurance. Have you considerered the advantage of personal life insurance to cover your mortgage? Consider the differences:
Most companies offer decreasing term insurance. Even though the death benefit is decreasing, the cost remains level. The coverage expires without allowing you the opportunity to purchase other insurance or provide you with cash values.
The proceeds are payable to the mortgage company. In the event of death, the mortgage is automatically repaid.
In most cases, if you take your mortgage to another company, you lose your protection. To obtain mortgage insurance with the new company you must submit new satisfactory evidence of health and are subject to the current rate charged by the new mortgage company.
The face amount can only be the exact amount of your mortgage (no more, no less).
You may not be able to insure both you and your spouse if the mortgage is registered in only one spouse's name.
INDIVIDUAL LIFE INSURANCE
You can choose term coverage and match the term length to your amortization period. A term policy may be converted, regardless of health, until age 65.
Or you can choose permanent coverage immediately. At some point in the future, the cash value of a permanent policy may be sufficient to pay off the balance of the mortgage.
You appoint a beneficary who can use the proceeds in whatever manner they wish.
Your policy is portable. If you transfer your mortgage to another company, your insurance remains in force. You don't need to re-apply and prove your insurability. You're protected from the danger of losing your insurance because of a change in your health.
You may select an insurance amount sufficient to cover your mortgage and other outstanding debts and term length to match your amortization.
You can insure both you and your spouse even if the mortgage is registered in one spouse's name.
*Sun Life Assurance Company of Canada