Mortgage Life Insurance

You already have mortgage insurance through your bank?


Great! That's why you need to read this.

We're not here to offer you more insurance. We're here to educate you and help you save thousands of dollars on the coverage you already have.

mortgage house

You already have mortgage insurance through the bank?


Great! That's why you need to read this.

We're not here to offer you more insurance. We're here to educate you and help you save thousands of dollars on the coverage you already have.

mortgage house

What is Mortgage Life Insurance?

Mortgage Life Insurance, or often referred to as just "Mortgage Insurance" (no to be confused with Canada Mortgage and Housing Corporation (CMHC) insurance, commonly known as "Default Insurance") is meant to protect the mortgage liability someone may leave behind if they pass away.

When someone has a mortgage and they pass away, there's still an outstanding balance on that mortgage. When this happens, their family and dependants may not be able to afford the mortgage payments or be able to stay in the family home.


Mortgage Life Insurance helps protect the outstanding balance of the mortgage.

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woman

Protects your family home

For most people, their home is probably the biggest investment they have ever made. Making sure their investment is protected is a smart decision.

Financial relief for you family

When a tragedy happens, the last thing your family wants to think about is paying the bills. Mortgage insurance is a great way to provide a financial safety net.

Peace of mind

Knowing that your family will be able to keep the family home without financial worries is priceless.

There's only two ways to get Mortgage Life Insurance

Through your bank or lender

This is how most people buy Mortgage Life Insurance. Too often, people accept it because their mortgage agent makes it sound like it's "part of the process".


However, this is far from the truth. A mortgage lender cannot make Mortgage Life Insurance a condition to obtain a mortgage, and neither is it mandatory.


This coverage offered through lenders is often much more expensive than superior coverage offered through a Life Insurance Company.


Even CBC Marketplace has made a documentary explaining why banks' Mortgage Life Insurance is one of the worst financial products available.

Watch CBC's documentary → Compare both coverages→

Through a Life Insurance Company

This is the best and more affordable way to get Mortgage Life Insurance.


Besides the opportunity to save thousands of dollars over the life of your mortgage, there are many more benefits available on Individually owned Life Insurance.


Individually owned Life Insurance, offers a great degree of flexibility and peace of mind that banks' mortgage insurance does not.


This type of coverage is portable and not tied to your bank. and it also offers lower and guaranteed premiums.


We have created a case study and a comparison table outlining the advantages and benefits of individually owned term life insurance.

Read case study → Compare both coverages→
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Case study and example

couple

Matt and Leslie are both 40 years old and just bought their first home. Here ar the details below:


Bank: TD

Mortgage Balance: $600,000

Amortization: 25 years

Payment option: Monthly

Mortgage Balance in year 15: $309,194.65


They understand that protecting their home is a top priority and they look at the options below.

Mortgage Insurance through the bank

TD Mortgage Protection Quote


Initial coverage:

600,000
Monthly Premium:

$200.24*

(including discounts)


*This premium is subject to change in the future

DOWNLOAD THE QUOTE AND SEE FOR YOUSELF

Monthly Savings:

$0

Savings over 20 years:

$0

If Matt were to pass away at year 15


TD Mortgage Protection would pay to:

The Bank:

$309,194.65

(mortgage balance)

LesIie:

$0

Even though Matt and Leslie were paying a higher premium, if Matt were to pass away, the Mortgage Protection plan would only pay to the bank the balance of the mortgage and leave Leslie with no additional funds.

Individual Term Life Insurance

Empire Life 20-year Term

   

Level coverage:

$600,000

Monthly Premium:

$90.36*

(including discounts)


*This premium is contractually guaranteed

DOWNLOAD THE QUOTE AND SEE FOR YOURSELF

Monthly Savings:

$109.88

Savings over 20 years:

$26,371.20

If Matt were to pass away at year 15


Empire Life would pay as follows:

The Bank:

$0

LesIie:

$600,000

With this option, the benefit amount always remains level. The benefit is paid directly to Leslie and she can choose to pay the mortgage balance and still have additional money to cover funeral expenses and for her family.

Check out CBC Marketplace's documentary:

In Denial - Regarding Mortgage Life Insurance in Canada

A comparison between Mortgage Protection Insurance and Term Life Insurance

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How to Buy Life Insurance

Although in today’s digital age you can buy insurance in many places, and online, it is always best to work with an independent insurance advisor, who can guide you through the options that will fit your specific needs and long-term goals.

What is Life Insurance?

Put simply, if you were to pass away, life insurance will help protect your loved ones financially. There are two primary types of life insurance — term or permanent. Term life insurance provides insurance protection for a set period — typically 10 to 40 years. Permanent insurance provides coverage for life.

How Does Life Insurance Work?

A life insurance policy is a contract between you and an insurance company. In exchange for your premium payments, the insurance company provides the coverage amount, also known as the death benefit, to your named beneficiaries should something unexpected happen to you.

Do I Need Life Insurance?

A simple rule of thumb is if you have shared debts or anyone relies on your income for their financial well-being, you should consider getting life insurance coverage. And every person’s life insurance needs are different and depend on many factors, such as how many dependents you have, how much you expect to earn, and even your gender.

FAQS

Got questions? We’ve got answers.

Mortgage Life Insurance

  • What Term Lengths are available?

    Term lengths are available* from 5 years to 40 years.


    *not all insurance companies offer all term lenghts

  • What insurance companies do you work for?

    As fully independent brokers, we are not affiliated directly with any particular insurance company.

     

    We work with over 20 different insurance companies to find you the best product and solution for your specific situation.


  • How much do you charge for your services?

    We never have to pay us for any consultation.


    As brokers, we are compensated by the financial compnaies that you do business with.

  • Where is your main office?

    Our office is located at:


    15 Allstate Parkway

    Suite 683

    Markham, ON

  • Are you licensed to sell insurance?

    Yes, our advisors are licensed to sell insurance in the provinces of Ontario and British Columbia.

  • Is it cheaper to buy directly from the insurance company?

    Whether you buy insurance directly from the insurance company or a broker, the price is going to be the same.


    By law, companies must offer the same premiums for the same products accross all channels.


    However, when you buy directly from an insurance company, you are missing the opportunity to compare the product that you are buying to other products in the market.

  • How can I consult with an advisor?

    We proud ourselves by being extremely flexible when we conduct business with clients.


    Want to stay at the confort of your home and have us visit? We can do that*


    Prefer to have an online meeting? No problem. We can connect via video call.


    Want to visit us at our office? We welcome you**



    *subject to location accessibility

    **by appointment only

  • What are the main differences between Mortgage Protection and Term Life Insurance?

    Mortgage protection insurance is usually offered by your mortgage lender. This type of coverage is not a contract, but rather, a certificate of insurance.


    There are usually very few questions required to begin coverage when you apply for a mortgage. 


    There are many disadvantges to purchasing Mortgage Protection Insurance through a lender:


    Premiums

    Premiums are normally a lot higher that what an average person would pay for the same initial coverage compared to Term Life Insurance.


    Also, with Mortgage Protection Insurance, the premiums are not guaranteed and are subject to change at any time. With a Term Life Insurance policy, your premiums are contractually guaranteed, so you will never have a premium surprise.


    Underwriting

    When applying for Mortgage Protection insurance, there are very few questions that you have to answer. The caveat is that just because you are paying for premiums, it does not mean that you are covered. This is because the underwriting with this policies is done at the time of claim.


    This means that when someone passes away that is when the insurance company will look into whether or not the person qualified for coverage when they completed the application.


    With Term Life Insurance, the underwriting is done at the time of the application and before any payments for premiums are taken. If the company decides that they will not cover you, they will let you know before they even take a premium payment.


    Coverage

    With Mortgage Protection Insurance, the coverage only covers the ramaining balance of the mortgage. So even if you were to have one mortgage payment left, that is all they will cover.


    With Term Life Insurance, the benefit remains level. For example, a $600,000 coverage will always pay $600,000 to the beneficiary.


    Beneficiary

    With Mortgage Protection Insurance, the bank is the beneficiary of youtr policy. With Term Life Insurance, you choose the beneficiary of the policy.


    Portability

    Mortgage Protection Insurance is tied to your lender AND to that mortgage. If you ever want to swtich lenders, or even refinance with the same lender, you will have to reapply for coverage, at which point you'll end up paying more just for the fact of being older.


    With Term Life Insurance, the coverage is yours and will remain with you whether you switch banks, refinance, repay your mortgage or even sell your home!


    Exclusions

    Term Life Insurance only has one exclusion; suicide during the first two years. After the policy has been in force for more than two years, there are no exlcusion as to how a person must die in order to be covered.


    Mortgage protection insurance has several exclusions for which they will not pay a benefit, including unlimited suicide clause, drunk sriving, acts of terrorism, etc.

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