Mortgage and Life Insurance
At times choosing the best life insurance coverage can be a hard task. That is why a lot of consultation and knowledge more about the insurance policy is a necessary thing to do. Also, there is a lot of variable to pushes one to pick a certain type of life insurance coverage depending on the benefits that come along with it. So, for example, an individual running a company with many employees who are exposed to insecurities while conducting their work. An employer would opt-in taking over on group term insurance, as it is the cheapest and one of the easiest to acquire. To add to this it allows coverage at the same time for a large group of individuals in that company.
Therefore, when choosing any life insurance coverage one specifically looks at the life insurance benefits that come along with it.
Life Insurance Benefits
The life insurance benefits vary depending on the life insurance coverage one takes and the corresponding goal of taking that insurance policy. While life insurance coverage depends on certain variables such as health, gender, and age. The benefits range from family benefits, death benefits or debt payment benefits. The more life insurance benefits expensive life insurance coverage. Insurance companies release packages that can benefit at least everyone in one way or another especially considering the rate of payments and the life insurance benefits that came along with it. Not all life insurance coverage provides all the life insurance benefits. Some just deal with the provision of mortgage benefits alone while others just provide death benefits only, all this depends on the policyholder’s goals and objectives.
Life Insurance vs Mortgage
This is one of the controversial statements in life insurance coverage and life insurance benefits. One does not need to have life insurance coverage to obtain a mortgage. Building insurance is one of the most popular requirements when acquiring a mortgage and not life insurance.
As for life insurance, the beneficiaries are the family members while for acquiring a mortgage the beneficiary is the mortgage lender. This, therefore, make it impossible for an individual with life insurance coverage to enjoy mortgage payment due to the difference in beneficiaries. In this, therefore, it makes life insurance coverage and mortgage not relatable in any way possible.
Life Insurance has different conditional ties when obtaining it as compared to that of the mortgage. The differences then mean that they equally serve different policies. For life insurance, the payment is only done as death benefits while that of a mortgage the payment is done when the policyholder is incapable to continue the payment of the mortgage due to various circumstances. Some of these circumstances might include death, unemployment, disability or sickness. Therefore, all these conditionality draw a line between life insurance and mortgage, which then it does not become a necessity for one to have life insurance to acquire the mortgage.
Mortgages can be offered with various financial institutions as compared to life insurance, which is only suitably acquired, form insurance companies. Mortgages can be acquired form banks also, as long as one can produce a corresponding bank statement. The mode of acquirement then qualifies the notion that it is not necessary to have life insurance to have a mortgage plan.
As for life insurance, the amount is of any amount, especially when one is under the coverage of term life insurance. While as for the mortgage, there is a standard amount of payment that is to be made to obtain the minimum requirement yearly. This brings a corresponding difference in the value of both life insurance and mortgage. It thus brings to the conclusion that acquiring a mortgage has nothing to do with having life insurance.
The term of the life insurance coverage and mortgages are different. Both of them have different timelines set to it. For example in life insurance, one can get life insurance coverage on a two basis. One is that of whole life insurance or term insurance. As for whole life insurance, the premiums are paid on a lifetime basis this then qualifies its value to be high. However, mortgages are not paid on a lifetime basis, and it is only paid until one can get the house or property that was under the mortgage. In conclusion, therefore one does not need to have a life insurance cover for one to get a mortgage cover.
The benefits of a life insurance have a wide range as compared to that of mortgage. A mortgage has the end life insurance benefit is having bought the house that was under a “Loan “.It does not enjoy other benefits like the family can inherit the policy or it issues a death benefit on which the family will be the potential beneficiary .
Both life insurance coverage and mortgage are two completely different elements and do not have any correlation. Any individual can be able to acquire a mortgage plan without necessarily having life insurance coverage. A life insurance coverage is not and will never be a factor to determine one to be able to acquire a mortgage. As seen, both of them have a different policy, different terms, and different value and even they are acquired from different institutions.
Although life insurance coverage at times enjoys the life insurance benefits of the mortgage payment, it is considered much expensive as compared to obtain a direct mortgage. The reason being for life insurance there has to be a medical check that has to be done. If one is found with any health condition then this makes life insurance much more expensive. As compared to acquiring mortgages, one does not necessarily require a medical check to acquire it. In this, therefore, it encourages those individuals who are having health condition and are unable to acquire life insurance to receive life insurance benefits such as mortgage payment, an option of mortgage directly should be an option. Before, one can acquire either life insurance or a mortgage consultation from the life insurance companies should be mandatory.