A mortgage is a long-standing commitment, and it doesn’t die with you. If you pass on before it is paid off, someone has to take up the responsibility of paying up the loan or risk losing the house. And that is when life insurance policy to cover your mortgage comes into play.
Mortgage protection life insurance, also referred to as mortgage protection insurance refers to a type of policy which pays off your remaining mortgage in case of your demise.
A mortgage life policy relieves the surviving members of your family from losing the house to the lending institution or taking on the financial responsibility of paying the remainder of the mortgage.
This life insurance will always repay the loan only if a mortgage still exists at the time of passing, while life insurance pays up death benefits only when the insured person dies. This kind of insurance policy is worth considering, regardless of whether you have one home, a second residence, or multiple residential properties.