Posts Tagged ‘mortgage life insurance’
Mortgage Insurance Quote Canada: How Are Mortgage Insurance Premiums Decided
June 24th, 2009
How much you pay for your mortgage insurance premiums will depend largely on three factors. If you compare a similar policy, you may get different quotes, based on the size of the mortgage, and the condition of the owner (age, smoker or non smoker).
Both mortgage life (to guarantee payment of the mortgage at the death of the insured) and disability (to provide income for paying the mortgage in case of the disability of the insured) use the same criteria to price the premiums.
As in most insurance policies, the physical condition and age of the insured have the most impact since it determines the possible chance the policy will have to be paid. A great many mortgage insurance policies do not even require a physical. Just because a physical is not required, don’t think you can hide a grave health condition or whether you are a smoker. Many smokers think they can hide this fact and keep the premium lower, and believe the insurance companies won’t know. But if the reason for death or disability can be connected to the hidden condition, the policy can be cancelled, and the insured would have paid premiums for nothing.
Recognizing this limitation, many companies now have Regular (for smokers) and Non-tobacco, which is for applicants who do not now use tobacco or have not used it within the prior twelve months period. Of course, the smoker’s risk is already priced into that policy.
It also has to be realized that any policy that does not have a health screening will have an automatic cost built in to cover additional risk. So those who are in extremely good health should consider taking the physical to see if lower premiums are available for him.
Age is a big factor in the way premiums are calculated, and if you compared a quote for a 38 year old, same mortgage, same length left on the loan, it would be less than half that of a 50 year old. Lowering the loan amount insured will not change the premium a great deal. It is not a surprise since, in addition to the risks of age and health, the risk of the premium being paid longer are much better.
The amount that will be insured is, of course the next main concern of the policy. Prior to the $250,000 threshold, however, there is not a great impact on prices. It is the higher priced homes that command the increased premiums and will usually require an assessment of the property.
Tags: Web development, web hosting, blog, marketing
Tags: b, blog, blogging, e, f, finance, h, home, home;improvement, i, insurance, life insurance, loans, m, mortgage, mortgage life insurance, o, r, real estate
Posted in blog | Comments (0)
