If you own a home, mortgage insurance is a given. (We hope!) But what kind of company have you trusted your policy with? People often choose the bank for mortgage insurance because they think it's easier and less time consuming; when in fact, it could be a costly mistake for everyone in your household. Let's take a look:
Insurance with a Broker:
- Protects your family
- Controlled by you
- Fully portable - transferable to any house
- Flexible - upon death, your family has the option of paying off the mortgage or investing the funds
- Allows shopping for better interest rates when mortgage renews
- Choice of plans and benefits
- Choice of amount of coverage and face amount does not decrease as the mortgage is reduced
- Coverage is convertible & renewable
- Stable - 30-day grace periods for missed premiums
- Expert advice - You deal with a professional insurance advisor about insurance and all insurance coverage can be through one broker
Insurance through a Bank:
- Protects the bank
- Controlled by the bank
- Runs out when house is sold or traded
- Inflexible - the mortgage must be paid off regardless of interest rates and other investment opportunities
- No shopping - unless you are willing to pay higher premium and are insurable
- Limited choices
- Coverage must be equal to the mortgage amount and decreases as the mortgage is reduced (premium does not!)
- Non-convertible
- A missed mortgage payment often means lost coverage
- You deal with a banker about insurance matters and the insurance coverage is spread all over
For more information on this visit our mortgage insurance page.
