Life Insuring Your Mortgage...

You are covered under a group policy owned by the bank. Because the bank owns the policy you have no control over the policy.

You purchase an individual policy owned by you. Because you own the policy you have complete control over it.

The features and provisions of the group policy are the same for everyone insured under it. Only the face amount will vary.

With an individual policy, you may select the type of plan you wish, the features and provisions you require. The choice is yours.

The face amount of your policy can only be for the exact amount of your mortgage (no less, no more).

You may purchase any amount of coverage you require.

The group coverage always declines as the mortgage declines. Rates remain the same until mortgage renewal, i. e paying the same for less and less coverage every month.

You may purchase any kind of insurance. Either permanent or term, level or decreasing. If level, you can decrease it if you choose.

The group policy can be cancelled by the bank or the issuing company at any time.

An individual policy cannot be cancelled unless you wish to cancel it yourself.

Group coverage will terminate upon any of the following events:
  a) the mortgage is repaid or 

      assumed
  b) the house is sold
  c) the mortgage is in default
  d) the group policy terminates

Because the coverage and mortgage are tied together, your ability to shop around for a mortgage in the future can be seriously restricted.

Your individual policy may be continued as long as you wish. It is a portable plan that can be used to cover any mortgage anywhere. (Statistics Canada report the average Canadian family moves once every five years).

Group mortgage insurance in not convertible.

An individual term policy may be converted regardless of health, usually until age 65.

Group mortgage insurance does not allow you to make beneficiary designations or to select settlement options. In the event of death, the bank is repaid automatically.

With an individual policy your beneficiary receives tax-free cash. They have the choice of repaying the mortgage or not, thus preventing hasty decisions. Proceeds are protected from creditors.

When you insure through the group policy offered by the bank, you are not given the benefit of professional insurance counselling. Your bank loans officer is not a licensed professional.

You have the advice of a licensed professional that can help you in choosing from a great choice of plans. This service in the years to come can be invaluable.

Costs can increase -usually no guarantee of future renewal rates.

Guaranteed Rates. In addition to all of the above, the cost is usually just plain cheaper too.