Taking out a loan, more so a mortgage can seem scary. Without proper financing and/or household budgeting, this could take a huge chunk of your yearly budget. However, with proper planning, a mortgage doesn’t seem like a bad idea at all. In fact, it goes towards an investment that you can call your own after a few years.
However, what if the mortgage is under your spouse’s name, which happened to be the breadwinner, and suddenly the breadwinner gets injured or can’t proceed with work? What if the breadwinner dies? While we don’t want any of those happening, it pays to be informed of your decisions and it pays if you’re initially aware that you have options to prevent further problems during untoward incidents like these.
What Is Protection Insurance For Mortgages?
Mortgage protection insurance is pretty simple. Just like any other type of insurance, you pay for a premium, and when you have an accident which prevents you from working, or the breadwinner dies during the duration of the policy, the insurance company will process your death benefit.
Simply said, this type of insurance is a special type of policy specifically meant for those individuals who have an existing mortgage. This gives you the peace of mind that no matter what happens to you, you’re covered and that you won’t leave your family struggling to pay for mortgage debt.
As discussed earlier, this doesn’t just apply to the death of the breadwinner or policy owner. During those incidents that you have been involved in an accident or an injury which prevents you from working, your mortgage insurance may cover the mortgage payments until you’re ready to get back up on your feet again, financially speaking. This can also apply when you lose your job and your mortgage will cover those fees until you find a new job. While this may seem like an added cost, you can treat this as an investment and an assurance that your mortgage will be paid off no matter what the circumstances are.
How Much Will You Get?
Just like any other insurance policy, the benefits you’ll receive depends on the policy amount. At times, the insurance policy may pay the remaining mortgage left during the time of the incident. There are other premiums on the other hand that pays for the entire mortgage amount, regardless, and the beneficiary would get to keep the extra money.
For certain instances, where you’ll be able to pay off your mortgage ahead of time, you can get the benefits until the entire duration of the policy. You may want to check with your insurance company the premium as well as the benefits and compare plans that suit your needs.
Finding The Right Insurance Policy For You
Just like in any insurance policy, do not rush yourself into signing up and getting protection insurance for mortgages immediately. Review the policy, check the company, ask for referrals, ask the insurance company as many questions as you can to ensure that you’re going with one that suits your budget and needs.
Generally speaking, protection insurance for mortgages isn’t something that many people are talking about but is a must-have for everyone who wants to secure their mortgage payments. Talk to your insurance agent to learn more about the options available and applicable to you.