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THE DANGERS OF MORTGAGE LIFE INSURANCE!!!
Signing up for the Mortgage Insurance offered by your bank or mortgage broker may be the worst financial decision you ever make!
SAY NO TO YOUR BANKS MORTGAGE INSURANCE!.. Make sure you watch the disturbing investigation on CBC'S MARKETPLACE to find out why!
1. What is Term insurance? Term insurance policies cover the insured for a stated term. The most common type of term policies are Term 10 and Term 20 policies. For example, on these plans the premiums are fixed for 10 years or 20 years and they rise substantially as the insured ages. Most Term policies are renewable and convertible, meaning the coverage can be renewed and/or converted to a permanent plan without a medical.
2.Why should I buy Life insurance? Life insurance can be used for a number of reasons. Here is a sampling of six of these, but there are many more: Income Replacement, Paying off a mortgage or a line of credit, Final Expenses, Emergency Fund, Money used to fund your child’s education, Estate preservation and creation. (Life insurance is seen by many as an unselfish act because the money is used for their loved ones.)
3. Is there a time limit for the beneficiary for claiming an amount after the an insured dies? So long as the information on the initial application is correct there should be no time limit on collecting the claim. The insurance company will need a death certificate and the beneficiary(s) will need to sign a claimants statement.
4. How much Life insurance do I need? We have an online calculator that makes this process easy right here: Needs-Analysis Calculator. The formula breaks down as, Existing Assets, (including all the life insurance that’s currently in-force) minus Current Liabilities and Income Replacement Needs, equals The Amount of Insurance Needed for Adequate Coverage.
5. How our insurance brokers paid? Life insurance brokers are generally paid a commission by the insurance company for each policy sold. This cost is built into the premium, so the consumer does not pay any type of surcharge. In fact, buying life insurance via direct distribution channels (where a commission is not generated) is often more expensive because the fixed cost of employees salaries and necessary infrastructure is higher than the distribution costs under the commission-driven broker network.
6. Can I get Life insurance without a medical exam? Yes, there are an increasing number of non-medical life insurance providers in Canada. The two types of non-medical life insurance policies are, Simplified Issue coverage and Guaranteed Issue coverage.
7. Can I get Life insurance if I’m sick? Yes, life insurance is available to people who are sick. Depending on the type of illness, the insured may still qualify for traditional life insurance plans that require medical tests and health questions. Otherwise, non-medical life insurance plans fall in the two categories mentioned above: Simplified Issue insurance (where there are no medical tests and three to 12 health questions) or Guaranteed Issue coverage (where there are no medical tests and no health questions).
Generally speaking, traditional life insurance offers a more affordable life insurance plan than Simplified or Guaranteed Issue coverage. Most Guaranteed Issue policies also have a two-year waiting period on the death-benefit, so if the insured dies in the first two years, the plan’s payout is limited to a return-of-premium plus interest.
Simplified Issue plan coverage can often start from day one, and the face amounts, along with the premiums, are lower than those of Guaranteed Issue life insurance. Guaranteed issue plans have higher premiums and the death benefit is often limited to a return of premium, plus interest for all non-accidental deaths in the first two years.
8. How do I know my Life insurance policy will pay out? Life insurance policies generally have a two-year contestability period, which means the insurance company can contest the claim for the first two policy years if there is misrepresentation on the application. The insurance company can also contest claims for the life of the policy in the event of fraud.
F1RST CHO1CE Insurance Solutions is very active all throughout the claims paying process. We walk the claimant through any necessary paperwork and follow-up with the insurance carrier to make sure the process is as seamless and as trouble free as possible.
9. Should I buy Life insurance online? Generally, we don’t recommend it. Most online life insurance providers offer their own proprietary product. Whereas, an independent broker offers insurance from a variety of carriers. Life insurance can be complicated and can play a huge role in your family’s financial future. We believe that working with an honest and reliable independent broker will ensure you make the right decision.
10. Is Mortgage insurance through the bank a rip-off? YES absolutely! Any type of life, critical illness or disability insurance offered through your bank has serious disadvantages when compared to a personally owned insurance policy. CLICK HERE to visit our Mortgage Insurance page to learn more about the dangers associated with insurance policies offered by your bank or mortgage broker.
At F1RST CHO1CE Insurance Solutions were passionate about sharing our knowledge, experience and unbiased opinions with families and individuals that are looking for a trusted advisor to help them with their Insurance options.
ANY QUESTIONS?…Contact a Licensed Insurance Advisor today!