Term life vs. Group mortgage life insurance
There are things to consider in comparing term life insurance to the group mortgage insurance offered by many financial institutions.
Group mortgage life insurance
- The financial institution is the automatic beneficiary for the amount due.
- Policy choices usually have less flexibility for amounts and periods of coverage.
- A waiver of premium for disability is usually not available with a group policy.
- Provisions can be canceled by the insurance company or policy owner. You are certificate holder; the financial institution is the policy owner.
- Portability is applicable to a particular mortgage loan. If a loan is terminated, so is your protection.
- Flexibility for additional coverage is usually not available. Coverage for a spouse may be available with some group policies.
Term life insurance
- You name the beneficiary.
- There are policy choices for an initial amount, subject to policy limits that meet your needs.
- A waiver of premium for disability is optional coverage. If you are totally disabled for the time period defined in the rider, premiums will be paid for as long as you remain totally disabled.
- Provisions cannot be canceled by the insurer. You own the policy and it stays in force for its term, as long as the premiums are paid.
- While the policy is in force, it may be converted to permanent life insurance without evidence of insurability prior to age 75.
- Portability protection does not stop if you move. The policy can follow you from one mortgage loan to another.
- Additional protection can be added according to your needs and your spouse and children if each qualifies.
All group mortgage plans are not the same. This is a general comparison only and may not be applicable to a specific group policy.
In Michigan Contact a Michigan life insurance agent for an update on which life insurance policy is right for you.
Finally, for more information on other types of life insurance offered in Michigan visit Michigan Financial Products.