Coming to terms with home ownership

If you’ve purchased a new home or condo recently, you know that mortgage payments will be just one of your many ongoing financial responsibilities in the coming years.

And although mortgage rates are at near historic lows, history tells us that rates will undoubtedly rise in the future, which could put you and your family under financial pressure.

But a sobering reality is that higher mortgage payments or a leaky roof aren’t the worst things that can happen when you own a home. If the unthinkable were to happen, would your loved ones have the means to continue to pay the mortgage for your family home?

Term life insurance vs. mortgage insurance

One of the easiest ways to give your family the security they deserve is to ensure you have enough insurance to cover your mortgage and other expenses in the event you pass away.

Some homeowners opt to go with the mortgage insurance banks offer when they sign the mortgage papers. It’s fast, easy and convenient – and you only have to answer a few basic health questions. But here are some important things to note:

Term life insurance is generally a less expensive, more flexible solution.

Mortgage insurance pays out the amount left owing on your mortgage when you pass away. As your mortgage balance declines each month, so does your coverage – yet your premiums remain the same. With term life insurance, the amount your beneficiaries will receive never declines. It remains the same throughout the term of your policy.

Moreover, if you die, term life insurance pays the entire tax-free, lump-sum death benefit to your beneficiaries, so they have the freedom to decide how the money should be spent. Mortgage insurance pays the remaining balance of your mortgage to your bank.

Mortgage insurance doesn’t move with you. Term life insurance does

If you have mortgage insurance and switch homes – or lenders – you’ll have to apply for a new mortgage insurance policy, and will have to undergo medical underwriting, which may, depending on your age and health, increase your premiums.

Term life insurance, on the other hand, isn’t attached to your debt. It’s attached to you – so it moves with you, no matter where you call home.

If you’re a first-time home buyer looking to purchase long-term protection to cover your mortgage and your family’s other financial obligations, CAA Term Life Insurance is the ideal choice:

• Coverage amounts from $50,000 up to $1,000,000
• Insurance rates are locked in for the term you choose: five, 10, 15 or even 20 years
• Save 25% every year on coverage of more than $250,000; 30% on amounts more than $500,000

And if you already have mortgage insurance? Consider the many benefits you’ll enjoy by increasing your term life insurance coverage to include your mortgage debt, as well! 

Buying a home may be one of the smartest decisions you’ve ever made. Protecting that asset and your loved ones with CAA Term Life Insurance may be one of the wisest. Learn more here or call 1-888-334-4568.

Underwritten by The Manufacturers Life Insurance Company (Manulife). ® CAA and CAA logo trademarks owned by, and use is authorized by, the Canadian Automobile Association. Manulife, Manulife & Stylized M Design, and Stylized M Design are trademarks of The Manufacturers Life Insurance Company and are used by it, and by its affiliates under licence. © 2019 The Manufacturers Life Insurance Company. All rights reserved. Manulife, P.O. Box 670, Stn Waterloo, Waterloo, ON N2J 4B8.