Posted by When we complete a stack of procedures and buy a house we love, we usually also "own" a mortgage.In this process, we will inevitably encounter the problem of Mortgage Protection Insurance (Mortgage Protection Insurance), or mortgage life insurance.What exactly is this insurance?What's the use?withTraditional term life insuranceWhat's the difference?Is it mandatory to purchase by law?How can we choose?For this long list of questions,American Life Insurance GuideNet insurGuru column will provide answers.
What is home loan insurance and what it is not
Usually in usBuy a houseHour, orBuy a houseLater, the borrowing bank or financial institution will make a recommendation to purchase mortgage insurance.If we just bought a house, or just did Refinance, our mailbox may have received a lot of housing loan insurance advertisements.Before we make a decision to buy, we need to understand what it is.
Home loan insurance, Mortgage protection insurance, abbreviated asMPI,YesTerm life insuranceAn application.
It, only, provides protection for the monthly payment of housing loans.When you pass away unfortunately, the death compensation guarantees to continue to pay the mortgage, so that the family will not have to sell the house and lose the place to live.
This kind of commonBeneficiary of the policyIt is a financial institution that borrows money. When you pass away, the financial institution will receive compensation from the insurance company.It is generally believed that housing loan insurance is more inclined to protect financial institutions that borrow money.
What is the difference between mortgage insurance MPI and PMI when buying a house
Mortgage Insurance MPIWith the buyerSMEs (Private Mortgage Insurance) is completely different.
PMI insuranceIt is when we are unable to pay the down payment (usually 20%) for the purchase of a house, in order to cope with the risk, the person who lent us the money asks us to buy it.
The housing loan insurance MPI is to solve the problem of whether we can continue to repay the mortgage every month after we lose our income.
Therefore, MPI is not included in the PMI (Private Mortgage Life Insurance) when buying a house.
Is mortgage insurance required by law?
No.
What is the difference between mortgage insurance and term life insurance?
Home loan insurance Be Term life insurance One of the applications is of a "consumer product" nature, and the operating mechanism is also the same.
After purchasing these two types of insurance, we choose how many years of coverage, and then pay the premium every month, when it happens "Trigger compensation conditionsIn the case of ", the compensation will be paid to the beneficiary.
However, mortgage insurance and term life insurance are still significantly different:
- The protection object of mortgage insurance is "loan", and the claim payment can only be used to repay the loan of the designated house.The protection object of term life insurance is all your potential risks. The claim payment can be freely used, and can be used to include, but is not limited to, repayment of loans, and can also be used to repay loans of other properties.
- Mortgage insuranceThe beneficiary is the financial institution that borrowed the money, Term life insuranceThe beneficiaries are determined by ourselves.
- Mortgage loan insurance is usually a term life insurance policy of decreasing denomination, and term life insurance can always provide the same amount of protection.
- Housing loan insurance is usually more expensive than term life insurance policies. The reason is that housing loan insurance usually does not carry out medical examinations and is guaranteed to be issued.The term life insurance may require medical examination, and if the health condition is not up to standard, the insurance may be rejected.
| Mortgage Life Insurance | Term life insurance | |
| Guarantee object | Loan risk | All risks |
| Beneficiary | Financial institution | 自己 |
| Compensation | Decrease year by year | Flat |
| Physical examination | No need | might need |
Should we buy mortgage insurance or term life insurance?
For mostBuy a houseFor the family,Term life insuranceIt is a better choice than mortgage insurance.The reason is:
- Term life insurance provides protection not only for housing loans Your beneficiaries can use the compensation to pay for their children's tuition, living expenses, etc.In general, term life insurance provides greater flexibility.
- We can choose the size of the policy Housing loan insurance protects the risk share of financial institutions. Therefore, the insurance coverage of this type of insurance policy is strictly limited to the loan amount.
- We can choose the length of the coverage period of the policy Housing loan insurance is usually 15 years or 30 years, synchronized with the loan time, and the length of the term life insurance policy is determined by ourselves.
- save costs Home loan insurance is usually more expensive than traditional term life insurance policies.
Under what circumstances to choose home loan insurance?
In some special cases, mortgage insurance may be worth choosing.
Because housing loan insurance is generally considered to be without a medical examination, it is guaranteed to be issuedTerm life insurance policyProducts, if our own physical condition is not good, there are many medical and disease records, and at the same time, it is difficult to pass the insurance company's medical examination and assurance standards.Then it makes sense to choose mortgage insurance.
Column summary
With the continuous development of the insurance industry and related laws and regulations, more and more life insurance products without physical examination have emerged on the market, and the application process has gradually become digitized and networked, and the process of applying for an insurance policy no longer constitutes an obstacle.
For Chinese families who need such protection needs as housing loan insurance when buying a house, what really needs to be paid attention to is that excellentProfessional brokerHow to help policyholders to identify a more comprehensive insurance policy with trigger conditions, and to balance the budget and additional clauses, to help each family configure a policy product that can truly protect the family.
The Bottom Line,It is more reasonable to spend money to protect yourself than to spend your own money to protect financial institutions.
(End of the article)
And the Truth:The premium of term life insurance products is much lower than the cost of whole life insurance, but the application procedures are strictly the same-in short, it means "less money, more responsibility"-therefore, in terms of human and time resources The extremely precious American society, this kind of product is mainly self-service application.According to the observations of the American Life Insurance Guide, so far there has been no service organization that provides professional term life insurance for the Chinese-speaking community.Then, for every family and individual, this type of insurance provides the most basic limited protection.You can visit here to visit the website of American Life Insurance Guide.Online quotation for term life insurance和Price comparison tool和More explanation.
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