What is Mortgage Protection Insurance?

Mortgage protection insurance, also known mortgage life insurance, is a type of insurance policy designed to protect homeowners and their families in the event of the homeowner's death or disability. It provides financial security by ensuring that the mortgage on the home is paid off or covered if the insured individual passes away or becomes unable to work due to a disability.

The purpose of mortgage protection insurance is to safeguard the homeowner's family from the risk of losing their home or struggling with mortgage payments in the event of a tragedy. If the insured individual dies, the insurance policy pays out a death benefit to the beneficiary designated by the homeowner. This benefit can be used to pay off the outstanding mortgage balance, ensuring that the family can remain in their home without the burden of mortgage payments.

Similarly, if the insured person becomes disabled and unable to work, mortgage protection insurance can provide financial assistance by covering the mortgage payments during the disability period. The specifics of disability coverage may vary depending on the policy, so it's important to review the terms and conditions. The Clowe Agency is thoroughly trained on the particulars of over 75 differents plans, from over 30 A-rated insurance companies.

Many of these policies now offer "living benefits" riders included at no cost. Life insurance living benefits, also known as accelerated death benefits, may provide policyholders with the ability to access a portion of their life insurance death benefit while they are still alive. These benefits are designed to provide financial support to policyholders facing specific chronic, critical, and terminal illnesses...including long-term care situations.

It's worth noting that mortgage protection insurance is different from private mortgage insurance (PMI), which is typically required by lenders when a borrower puts down less than 20% of the home's purchase price as a down payment. PMI protects the lender in case the borrower defaults on the mortgage, whereas mortgage protection (MPI) insurance protects the homeowner and their family.

If you are considering mortgage protection insurance, it's essential to carefully review the terms, coverage limits, and exclusions of the policy. Let The Clowe Agency compare different insurance providers and policies to ensure you select the one that best suits your needs and financial situation.