7-Things You Need To Know
Before Buying Mortgage Protection Insurance
In the above video I review the 7-Things You Need To Know Before Buying Mortgage Protection Insurance so that your family does not become one of the millions who lose their home each year due to unforeseen circumstances. The text of the video is below.
For most of us, the mortgage on our home is our greatest investment and financial commitment. A home is more than just a roof over our heads. For our children, it’s their sanctuary. It’s where memories are made and lives are built.
However, on average more than 2,700,000 families lose their home to foreclosure annually in the United States. Half of those foreclosures could have been prevented with the right kind of mortgage protection insurance.
Rule # 1 Protect Against Lost Income from Critical or Chronic Illness
Most mortgage protection insurance policies ONLY insure against the premature death of a primary earner. The #1 reason for mortgage foreclosure is that one of the wage earners in the household becomes sick with a chronic or critical illness and lives. In fact 49% of all mortgage foreclosures in the United States is a direct consequence of the primary earning SURVIVING A critical or chronic illness. If that is not shocking enough; out of that group of families that lost their home to foreclosure. Do not settle for mortgage protection insurance that only protects your family if your die. This upgraded mortgage protection insurance does not cost any more than the old kind of coverage. Make certain you mortgage protection insurance will help your family cover your mortgage in case of critical or chronic illness…in addition to a premature death.
Rule # 2 Don’t Be Fooled
The benefit covering a person for critical and chronic illness is also called a living benefit or an accelerated death benefit. Some mortgage protection policies say they offer living benefits, but the benefit is limited to the diagnosis of a terminal illness with less than 12-months to live. Other mortgage protection policies use cash value life insurance and claim the cash value is the living benefit. While cash value life insurance has its place, it takes decades to build up enough cash value to compete with a real living benefit policy. In the meantime, you are left to fend for yourself. Your mortgage protection insurance should be low cost 30-year term coverage with living benefit.
Rule # 3 The Premium Never Increases, The Benefit Never Decreases
The best mortgage protection insurance has a fixed premium and benefit, not a benefit that declines yearly. It’s important that you know your insurance premium will not increase and your benefit will remain fixed for the life of the policy, unless you choose to reduce the coverage and the cost. You always have the choice of reducing your coverage and lowering your cost if needs or budget changes.
Rule #4 Some Protection is Better Than None
You don’t necessarily need to pay off a mortgage entirely with your mortgage insurance. If you can’t afford enough insurance coverage to pay off your mortgage, you can still protect your family and keep them in your home by having coverage that will keep your family in your home until you recover. A policy that can pay the mortgage for three or even five years in the case of a critical or chronic illness can give you time to recover and get back to earning a living in many cases. Having some coverage gives you and your family options. Having no mortgage protection puts your family in the position of having no options.
Rule #5 It’s Mortgage Protection, Not Unemployement Insurance
There is no such thing as mortgage protection insurance that pays your mortgage in the case of becoming unemployed. That would be unemployment insurance. There are some policies that propose to offer the ability to pay the mortgage protection insurance premiums in the case of unemployment, but that supposed benefit is so restrictive that few people would ever qualify. Read the fine-print and do not make assumption! You typically have to be part of group layoff and unemployed for three months before your premiums can be waived temporarily. If an agent uses that benefit as a selling point, step back and review the fine print. If they suggest it is insurance against becoming unemployed, run away. They are not being honest with you.
Rule #6 The Financial Rating Is Important
The financial rating of your insurance company is important. If it’s not at least an A rated company that means it is a financial risk. Many professional investors and organizations would shy away from investing their assets with such a low rated company, so why risk your families future on a company that might not have the assets to live up to their end of the contract.
Rule # 7 Answer for yourself; Why Do I need Mortgage Protection Insurance?
Why do we buy insurance? ?? We buy insurance for peace of mind. We buy insurance for the people in our lives that we love. We cannot avoid risk in life, but we can transfer the financial risk of an unexpected event to the insurance company so that we or our families are not financially ruined. We buy mortgage protection insurance to protect our family’s quality of life. We buy it so that if the unexpected happens we, our spouse and our children still have a roof over their heads. The kids can still go to their school, and wake up each morning secure in their own house. We buy mortgage protection insurance because we love our family.
At Shield Insurance Solutions we shop the market to help find the best policy that will cover you not just in case you die too soon, but if you get life threatening cancer, a heart attack, stroke, auto accident or other critical or chronic illness and are unable to work.
So there you have it; the 7 things you need to knwo before buying mortgage protection insurance. When you compare policies, price is imortant, but understanding your coverage is more important. Don’t buy a policy that only protects you against a premayure death. The odds are the protection against critical and chronic illness will be more important to your family’s quality of life.
Let us shop for you.
Call us today, or complete the form below. No pressure. No barrage of phone calls. We are here to help you.
Shield Insurance Solutions is based in Jupiter, Palm Beach Florida. We work with people from coast-to-coast for mortgage protection, life and Medicare insurance needs.