Would your family lose the family home if you pass away unexpectedly?
Typically, after you purchase a new home you will receive a notice in the mail about Mortgage Protection Insurance Benefits Program. The letter usually says something like this. Mortgage Protection Plan insurance will pay off your mortgage if you die, become permanently disabled or terminally ill. If you sit and think about mortgage protection coverage it sounds like a great insurance to protect your home and assets.
Mortgage protection insurance benefits do not decrease or go down; they stay level throughout the term based on policy details selected. No need for you to get a medical exam or blood draw either with most mortgage protection insurance or final expense burial insurance.
Mortgage protection insurance is either a term or universal life policy. Insurance terms are usually 10 year, 20 year, 30 year terms with level premiums.
The 10 year term will be least expensive. The universal life policy tends to be more expensive because it covers you up into the later years of life, based on the policy you choose. The premium will not increase, and benefits will not go down based on the plan selected.
Mortgage protection insurance policies have a special feature called living benefits.
Tax free accelerated living benefits that are attached to the policy in the form of riders that are included at no additional cost. These are riders that can be used as an option if needed while you are still alive if a certain health condition arises. That’s why they’re called living benefits riders. Mortgage protection life insurance is about the same cost as a typical term policy with no medical exam to cover you and your family.
Mortgage Protection insurance benefits:
- Critical Illness Rider pays out benefits per occurrence based on the policy. Some of the conditions might be heart attack, stroke, cancer, organ failure just to name a few. Basically, you take a payout depending on the amount of coverage and the severity of the illness. This could help pay the mortgage off early or give you additional money for medical expenses or experimental health treatments.
- Chronic Disability Rider could pay a benefit due to a permanent disability. Loss of use of your extremities, site or hearing. Great for replacing lost income due unemployment to pay bills, mortgage payments, utilities, groceries.
- Terminal Illness Rider could pay out due to a terminal illness with a life expectancy of 12 to 24 months. You could accelerate the death benefit early to do what you wish with it. Pay off your home mortgage. Leave money in the bank for your spouse and children.
- Traditional Death Benefit pays out in the event of death due to natural causes or accident. Tax free benefits are paid directly to the beneficiaries of your choice, not the bank.
Can I accelerate mortgage protection insurance benefits more than once?
Yes – When you take less than the full election amount at the time of the initial claim. You can elect to receive additional benefit amounts at a later date. As long as the total benefits does not exceed the allowable amount for all mortgage protection accelerated riders.
If I elect to take an accelerated claim due to a critical illness, will the remainder be available to my beneficiary in the event of my death?
Yes – For example if you have a $100,000 policy and elect to accelerate 50% of the death benefit due to chronic or critical illness, you still have $50,000 or 50% of your death benefit remaining for your beneficiary in the event of your death.
Mortgage protection insurance with living benefits could help pay mortgage payments during a time of need with no income. Typically when you have a critical illness your income goes away and expenses increase dramatically. Mortgage protection insurance could be one of the best insurance choices for you and your family.
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