Frequently Asked
Questions
[READ the article "Having your Cake and Eating it too"]
What is Mortgage Protection?
Mortgage insurance is similar to
traditional life insurance, but includes many living benefits as well.
These benefits include options, such as, Return-of-Premium, Child Riders,
Disability Option, Critical Illness, Waiver-of-Premium, and Accelerated Death
Benefits.
What is Return-of-Premium? Wouldn't it
be nice, if your car insurance company returned all your premiums to you if you
never used the coverage? Well, that is exactly the way this popular new life
insurance feature works. The insurance company invests a portion of your
premiums while you participate in the plan.
If you need
the coverage during your 15, 20 or 30-year term, then your family would be
protected, but if you don't, all premiums would be returned to you at the end of
the term you selected. And if in the meantime, you borrow against your plan,
don't worry -- the insurance company will simply deduct whatever you borrowed
from the premiums they collected, and that adjusted amount will be returned to
you.
How does the Critical Illness Option work?
Critical illness
either pays out a lump sum or provides an income if you are diagnosed as having
one of a number of illnesses, including cancer, strokes or heart disease -- even
if you make a full recovery.
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What is Waiver-of-Premium?
These
policies also include many free options such as Unemployment Waiver-of-Premium,
where if you become unemployed the plan waives its premium for a specific period
of time and essentially pays for itself, so that you are not at risk of loosing
your life insurance.
What is an Accelerated Death Benefit?
Accelerated Death Benefit
allows you to cash out up to
75% of your policy's face amount should you become terminally ill.
How does the Disability Option work? Available as a stand-alone option, or as a rider to your mortgage protection plan. If you become injured, on the job or off the job, due to sickness or injury, this plan would make your monthly mortgage payments until you can go back to work. The consumer would define the elimination and benefit period of the plan, to help determine the ultimate cost.