# Mortgage Insurance



## liquidfinance (Jan 28, 2011)

How much should you typically be paying for this? Say on a $150,000 mortgage mid 30's no health issues. 

I do not know Canadian prices but to me the insurance my wife has seems expensive. She took it out with the credit union with her initial mortgage. Now my view is that this should be cancelled and then we should look for an alternative. 

I also don't feel some of the coverage offers much benefit to us. Unemployment for example. She is currently self employed. Also I'm not on the mortgage as she purchased the house before I knew her.


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## marina628 (Dec 14, 2010)

It is usually cheaper to get a term policy for the mortgage payoff than go with the bank .Definitely have a new policy in place before cancelling this one.


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## MoneyGal (Apr 24, 2009)

Ask yourself always, who benefits if you buy this product? Answer for mortgage insurance: the bank. 

Hint: the insurance cost remains level even as your balance declines. How does that benefit you, exactly?


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## liquidfinance (Jan 28, 2011)

I just found this article 

http://www.thestar.com/life/homes/2007/04/22/perils_of_a_mortgage_life_policy.html

Lets just say my wife is paying around what is quoted in that article. 

I used the comparison site for a quick check. Feeling a little sick about what she has been paying now.


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## birdman (Feb 12, 2013)

MoneyGal said:


> Ask yourself always, who benefits if you buy this product? Answer for mortgage insurance: the bank.
> 
> Hint: the insurance cost remains level even as your balance declines. How does that benefit you, exactly?


I certainly agree with this and while I cannot comment of Mortgage Insurance, when I was in the business we tried to sell "Sickness and Accident Insurance" for loans and mortgages and the financial institution took 40%!!!! of the premium as their commission. Add on the insurance company overhead and profits and I expect they only payout 20% of the premiums collected. Not worth the risk if you can do without it and I would expect some term insurance would be cheaper.


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## OptsyEagle (Nov 29, 2009)

Female, age 35, non-smoker, average health, Term 10, $150,000 with Manulife = $14.48 per month. This is level insurance, and the death benefit goes directly to the beneficiary and they can decide how to deal with the mortgage.

Mortgage insurance is declining term and is a mortgage term renewable plan where the price is adjusted every time you renew the mortgage as opposed to 10 years in the term 10 above

A term 20 policy, like the above, again with Manulife is $18.95 per month.

Manulife was in the lowest tier for pricing for this person, but the others are not that much higher.


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## off.by.10 (Mar 16, 2014)

MoneyGal said:


> Hint: the insurance cost remains level even as your balance declines. How does that benefit you, exactly?


Not all do. Ours is simply a % added to the interest rate (0.42 IIRC and it includes some disability coverage) so it goes down with the balance. Still probably won't renew it as our situation has changed and it no longer fits our needs.


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## Feruk (Aug 15, 2012)

liquidfinance said:


> How much should you typically be paying for this?


$0


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## My Own Advisor (Sep 24, 2012)

Agreed with Feruk. Don't buy mortgage insurance. Buy a term life policy instead. Check this out:
http://www.myownadvisor.ca/mortgage-insurance-doesnt-work-everyone/


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## uptoolate (Oct 9, 2011)

Feruk said:


> $0


yes


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