What is Mortgage Protection?
Mortgage insurance is similar to traditional
life insurance, but includes many living benefits as well.
These benefits include options, such as, Return-of-Premium, Child Riders,
Disability Option, Critical Illness, Waiver-of-Premium, and Accelerated Death
Benefits.
Living Benefits
What is Return-of-Premium? Wouldn't it be nice, if your car insurance
company returned all your premiums to you if you never used the coverage? Well,
that is exactly the way this popular new life insurance feature works. The
insurance company invests a portion of your premiums while you participate in
the plan.
If you need the coverage during your 15, 20 or 30-year term, then
your family would be protected, but if you don't, all premiums would be returned
to you at the end of the term you selected. And if in the meantime, you borrow
against your plan, don't worry -- the insurance company will simply deduct
whatever you borrowed from the premiums they collected, and that adjusted amount
will be returned to you.
How does the Critical Illness Option work?
Critical illness
either pays out
a lump sum or provides an income if you are diagnosed as having one of a number
of illnesses, including cancer, strokes or heart disease -- even if you make a
full recovery.
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What is Waiver-of-Premium?
These policies
also include many free options such as Unemployment Waiver-of-Premium, where if
you become unemployed the plan waives its premium for a specific period of time
and essentially pays for itself, so that you are not at risk of loosing your
life insurance.
What is an Accelerated Death Benefit?
Accelerated
Death Benefit
allows you to cash out up to
75% of your policy's face amount should you become terminally ill.
How does the Disability Option work? Available as a stand-alone option, or as a rider to your mortgage protection plan. If you become injured, on the job or off the job, due to sickness or injury, this plan would make your monthly mortgage payments until you can go back to work. The consumer would define the elimination and benefit period of the plan, to help determine the ultimate cost.