How your mortgage payments will be paid off if you won’t be there anymore? For many, this is quite tricky to answer and here comes the significance of a mortgage protection insurance plan. A suitable mortgage protection insurance relieves you from the anxiety of losing the home if you or your family won’t be able to make the mortgage payments. However, it’s not as simple as life insurance and you may find it a bit confusing to choose such a plan. Here, we are helping with all the information you should have about different types of mortgage protection plans.
Losing a loved one is a heart-wrenching experience and it becomes worse if the person is sole breadwinner of the family. Let alone other things, just coping with loss and taking care of daily expenses becomes quite difficult in such situations and the obligation to pay mortgage premiums will be an additional financial burden and can easily make things worse. The accidental death mortgage protection comes very handy here and protects your family from losing the home if you expire. The insurer will take care of the mortgage payments till the mortgage is paid off.
Mostly, people get confused between life insurance mortgage and life insurance plans. These are the mortgages linked with a life insurance plan and help the insured with an added level of security. If you have linked your mortgage with the life insurance plan, the family will receive an accumulated death benefit when you die and your outstanding debt will be paid off by the insurer. These plans are offered with the options of paying a fixed premium throughout the policy or a consistently decreasing premium that ultimately becomes zero.
Getting the sole breadwinner diagnosed with a severe disease can be a big worry for the family and hence, there are specifically tailored mortgage protection plans for the same. If you get diagnosed with a terminal disease and are expected to die within a year, the insurer will pay you an accumulated cash amount to pay off the mortgage amount without any additional charge on your premiums. Whereas in case of getting diagnosed with a critical disease listed in your insurance policy, the insurer will take care of the expenses related to medical treatment, rehabilitation aids as well as debts including mortgage payments. Also, if you get diagnosed with a chronic disease like heart-attack, end-stage renal failure, cancer, stroke and major organ transplants, you will receive a lump sum amount from the insurer and can opt for a plan offering a partial as well as a complete death benefit.
To make sure the death or sickness benefits are approved with ease, you need to ensure all the terms of policy agreement are followed. You are suggested to never stop making the mortgage payments, at any cost. Due to any reason, if you stop paying your mortgage without any prior information to the lender, it would be considered a breaching of the mortgage agreement. In such a case, you or your family may not be eligible to receive any death or sickness benefit despite consistently paying a big portion of the mortgage amount. Still, if you face a condition when you can’t make the mortgage payments timely, please inform the lender as soon as possible to reduce the chances of losing your home.
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