Many homeowners who have taken out a mortgage loan have also purchased a mortgage life insurance of some type. In most cases it is a better idea to avoid these insurance products.
Most mortgage life insurance products are way over priced and are very expensive when you compare the benefits or potential payouts to the actual cost.
These products may not seem to have that much of an impact on your monthly budget but over time it adds up and the pay outs or probability of use just does not make financial sense for the amount the products charge for coverage.If you have recently taken on a home loan than you have received tons and tons of mortgage life insurance product offers via mail outs, emails, phone calls, and maybe even text messages. The offers are every where. This product is pushed extremely hard and aggressively because it is so profitable. Those folks pushing it on you will swear up and down that it is worth the peace of mind and security.
The truth of the matter is that mortgage life insurance or mortgage disability insurance products are typically grossly overpriced and are more like margin padding for insurers than insurance products or any sort of help for homeowners.
Most financial gurus with out conflicting incentives will tell you that you don’t need these products and that they are just not worth it. Most would agree that you are better off shopping around for low cost high quality term life insurance and long term disability insurance. These insurance products are a smarter and more effective way to fill any coverage gaps.