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Mortgage Insurance from Bank |
Mortgage Life Insurance from Life Insurance Companies |
Does the Death Benefit Remain Same or Level even though premiums always remain same? |
NO, As your mortgage decreases, so does your coverage. But your premium stays the same. The death benefit will pay only the balance of the mortgage upon death. |
YES, The death benefit of a personal plan remains level for as long as you own the plan unless you decide to decrease the coverage.
The death benefit will be whatever the face amount of insurance that has been purchased. |
Am I the Owner of the Policy as I am the one paying for it? |
NO, The bank is the owner of your coverage and can cancel it at any time |
YES, You own the coverage and are the only one who can cancel it. Any changes to the policy can only be made by you, the owner. |
Can I choose the Beneficiary of the Policy? |
NO, You have NO choice as to who the beneficiary is when you purchase the bank's mortgage insurance and Bank is the beneficiary of this coverage. |
YES, You have the choice of whom so ever you want to name as beneficiary of your life policy. Upon death, your survivor may choose not to pay the mortgage off immediately as there may be more attractive investments other than paying off the mortgage or there could be some other needs at that time like children’s education or some business investments. |
Will the Death Benefit pay double or separately in the event of husband and wife die together in a common disaster like Road Accident? |
NO, In the event of a common disaster ( husband and wife are both killed in a car accident) the bank will pay the mortgage balance only. |
YES, When using personal insurance, the insurance company will pay a death benefit on both of the lives insured. For example, if a husband and wife are covered for $150,000 each for their mortgage, the benefit would be $300,000 versus whatever the balance is on the mortgage at the bank. |
Is the coverage available if you change your Bank? |
NO, If you want to move your mortgage to another institution, you will have to reapply for mortgage insurance. This will then be purchased at your new attained age at a higher premium, assuming you are healthy enough to qualify for the coverage. |
YES, Even if you change Bank where you have mortgage, your coverage still stay’s the same you being the owner of the policy. |
Is the Underwriting done at the time of application? |
NO, When using the bank's insurance, underwriting of the insured will be done at the time of death. In this way, more problems than not can arise as the bank's insurer will try to dispute the claim if they find out some information was not disclosed correctly and completely at the time of application submission. |
YES, Underwriting is done at the time of application. Insurance company sends a Nurse for Blood work, urine sample, Nurse to ask Health questions or more based on coverage applied for, So in the event of a death, the insurance will pay the claim. The company can contest in the first two years after application in the event of fraud or non-disclosure. |
Are Preferred Rates available if I am in good health and Non Smoker? |
NO |
YES, Many companies offer preferred rates if you are in excellent health which results in a lower premium’s compared to a standard rate. |
Is the insurance plan Convertible? |
NO |
YES, you can convert your full coverage amount or portion of it to a permanent plan of insurance generally before age 65. |
Is the premium exempt from Provincial Sales Tax? |
NO, PST is added to the premium as it is group insurance. |
YES, PST is NOT payable on personal Life Insurance coverage. |
Can I Continue the coverage after the mortgage is paid? |
NO, Once mortgage is paid off, your mortgage insurance terminates automatically. |
YES, Once mortgage is paid off, you have the option to continue the coverage, convert the coverage or cancel the coverage. |
Are there any other Options and Benefits or Riders like ADD, CTB, DW available? |
NO ,There is no option to add any additional benefits or riders |
YES, Various options and riders are available to add to your coverage such as Accidental Death Dismemberment, Child Term Rider, Disability Waiver, etc. |