Buying a home is a major financial commitment. Depending on the loan you choose, you might commit yourself to 30 years of payments. But what will happen to your home if you suddenly die? What will be the impact upon your loved ones who want to continue to live in the home? How will they be able to afford to continue to make the mortgage payments?
One solution is a Term Life Insurance Policy covering the time commitment of the mortgage. Most Mortgage Protection Term Life policies work the same way as traditional life insurance policies. Every month, you pay the insurance company a premium for the length of the term selected: 10, 15, 20 or 30 years. This premium keeps your coverage current and ensures your protection. If you die during the term of the policy, your policy provider pays out a death benefit that covers not only the balance of the mortgage but the entire amount of the original death benefit selected.
Another solution gaining in popularity is a Guaranteed Universal Life (GUL) policy with a Return of Premium option. If the home owner does not die during the term of the mortgage, he or she may select to have the premiums returned and used to help accelerate the payoff of the mortgage. Click here to review a case study.
Since the mortgage is decreasing over time the excess in death benefit coverage can be used for other purposes by the beneficiary in case of the death of the owner. On the other hand, if the insured owner outlives the need for coverage on the mortgage, there is the option of taking the cash out in premiums paid to pay off the mortgage balance early or use for other purposes.
For the first option, of the typical Term Life coverage, it is an easy process to find out the approximate costs of your needed coverage by using our online shopping with Ethos. It only takes a few minutes to get an estimate and apply.
For the second option, of being able to get premiums back with a GUL, give Richard a call or contact him here for a quote and a more detailed explanation. Earn 500 free College Tuition points just for having the conversation!