Loan & mortgage insurance: Show them the difference between banks and insurers

 

Every spring, there’s a surge in real estate activity. Over the past five years, rising home prices have made the average new mortgage 44% larger - and even more than that in certain hotspots. That’s why this is the perfect time to educate potential clients about their options for insuring their debt.

Mortgages aren’t the only form of borrowing that has been increasing lately. Low interest rates and access to credit have seen total household debt reach all-time highs, including everything from credit cards and lines of credit to personal and business loans.

Many of these debts come with an enticing offer from the bank: simply opt-in for loan insurance or mortgage insurance, and if you pass away, your debt will be paid in full. Sometimes, all a client has to do is initial a box on the contract to accept this offer. But just because it’s easy to do, doesn’t mean it’s the best choice.

There are several issues that these clients should know about when it comes to comparing banks vs. insurance companies for debt protection. We recommend showing them how protecting their loans and mortgages with Beneva gives them the freedom to take out insurance on their own terms:

You own the contract

With Beneva, you choose the type of insurance and coverage amount that suits you so that you can cover not only your mortgage, but other debt as well.

You can be covered for disability, job loss and critical illness

With optional coverage like disability insurance, job loss protection and critical illness insurance, Beneva has solutions to keep up your payments, refund your premiums, or pay off your balance if something goes wrong.

Your coverage remains fixed

When you own your policy, your coverage amount remains the same throughout the life of the contract, unlike mortgage insurance from the bank, where your premiums stay high the whole time, even though the amount of your coverage slowly goes down.

You get a customized premium

A Beneva contract offers you affordable premiums based on your gender, age, health and smoking status. With the bank’s mortgage insurance, every client of the same age gets the same rate.

You avoid surprises

Beneva completes the underwriting to make sure you are insurable at the time of your application, not at the time of your claim, potentially protecting you and your loved ones from a negative surprise.

Your insurer sticks with you

Since you own the contract, it stays with you - even if you switch financial institutions or pay off your debt. That means you never have to deal with requalifying for mortgage insurance and there’s no need to worry about future price increases.

You choose your beneficiary

The main reason for loan and mortgage protection insurance is to take care of your loved ones - not the bank. With an insurance policy that you customize and own directly, you decide exactly how and to whom you want the benefits to be distributed.

Insurance coverage from Beneva has another advantage: one policy can protect all of your borrowing, including mortgage loans, lines of credit, personal loans and commercial mortgage loans. That’s a lot more efficient than signing up for a bunch of different creditor protection plans at the bank.

Many Canadians lack awareness of their choices when it comes to banks vs insurance companies, and this is a wonderful opportunity to help them make an informed decision about their mortgage and loan protection insurance. We are always here to support you with tools you can use. Good luck and happy real estate season!

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