People commonly look for mortgage life insurance when they still
pay mortgage such as home, apartment or villas. This insurance protects their
family if someday the one who pay the mortgage die. Thus, its product is
designed specifically to provide financial security. Their devastated family
can continue their life without worrying about the mortgage. Usually its term
length is between 15 to 30 years, suitable with mortgage term itself.
Mortgage
life insurance has two basic types; they are
decreasing and level term insurance.
Further information can be seen below:
·
Decreasing term insurance
The amount of the policies
will decrease with the outstanding balance of the mortgage itself. It means
that this insurance can provide a protection in repayment mortgage then the
amount of cover will reduce in line with the repayment mortgage decreasing.
The benefit of this
product is paying out the cash sum when you die during the period of your
policy.
·
Level term insurance
This product is only
appropriate for who interest in mortgage because its amount of policy cannot
decrease as decreasing term insurance. It only helps you to pay off the
outstanding mortgage if you die during the period of the policy. The benefits
you will get is paying out a cash sum and remain the same for the premiums and
also the amount of cover that you choose.
Mortgage
life insurance premium is various. However its
premium commonly bases on the price of your mortgage also. That is why you need
to know these main points of this product:
·
It is not an investment or
saving product, so you cannot take the money randomly and has no cash value
·
For decreasing term insurance,
there are some circumstance that the company cannot pay out the outstanding
mortgage fully
Therefore, you need to find the detail of
information before taking mortgage life
insurance. It is important for you to analyze the policy, premium and the
term.
