Mortgage Life Insurance
A mortgage life insurance policy helps guarantee a tax-free benefit to beneficiaries that can be used to help with mortgage payments or other financial responsibilities in the event of the policyholder’s death. A mortgage life insurance policy is a term life policy designed specifically to repay mortgage debts and associated costs in the event of the death of the borrower.
Other advantages include:
- With a mortgage life insurance policy in place, heirs won’t have to worry or wonder what might happen to the family home. If a policyholder dies or becomes gravely ill and unable to work, the mortgage life insurance policy will pay off the entire mortgage loan.
- With some exceptions, most traditional life insurance policies will not pay out unless you die within your coverage period. Most mortgage life insurance policies, on the other hand, offer coverage that works if you become disabled or unable to work, which makes this type of insurance a bit more versatile than a traditional term or whole life policy.
- This coverage relieves a policyholder’s worries about their family having a place to live if they die or cannot work. With the mortgage paid off, the family will always have a place to live, provided they can afford the property taxes and insurance each year.