Discover the Advantages & Disadvantages of Life & Mortgage Insurance

Life Insurance

Having the right life insurance coverage in place can make a big difference in the lives of your loved ones in the event of your premature death. St. John’s Life Insurance can offer you a tailored solution to your individual needs for term insurance or a more permanent solution.

Term Insurance

Term insurance, which in general comes in Term 10, Term 20, Term 30, and more, is used for a time in your life when greater protection is required to cover specific items like:

• Final expenses
• Estate/taxes
• Mortgages
• Providing money for a young family including:
• Education
• Day to day living
• Business coverage
• Large loans

Permanent Insurance

Permanent insurance can be used as a retirement tool for whole life coverage that builds cash values that can be used later in life while universal life Insurance can be a tax efficient way to have life insurance with an investment component.

Both term and permanent insurance can also be combined together as a tailored solution. Permanent insurance can also be paid up in 10, 15, or 20 years, but the coverage is for lifetime. This is good for retirement planning. For example, if you take out a Life Pay 20 for $100,000 at age 40, there are no more premiums, but you have that $100,000 coverage for the rest of your life. Good deal, correct? Life insurance gives you peace of mind coverage knowing that your loved ones will be taken care of with a lump sum, tax-free benefit.

Mortgage Insurance

Getting the right mortgage life insurance can mean the difference between keeping your dream home or losing it because you didn’t have the right mortgage insurance in place. Unlike many bank-issued policies that are intended to protect the bank’s interests, a personal life insurance policy protects you – after all, you are the one paying the mortgage payments. Bank-issued mortgage insurance is intended to pay off the balance of your mortgage, and you have no control over where your payout goes. On the other hand, a personal life policy is paid out directly to your loved ones, and they decide exactly how to allocate the proceeds.

However, there can be many pitfalls associated with bank mortgage insurance that many consumers simply aren’t aware of. What the banks don’t make clear is the numerous advantages of term life insurance when compared to bank mortgage insurance.

Example Scenario

Mr. and Mrs. Jones purchased a mortgage insurance policy from their bank when they bought their new home. Unfortunately, a couple of years later Mr. Jones passed away. The bank immediately forced Mrs. Jones to pay off the entire mortgage balance with the proceeds of the Bank Mortgage Insurance Policy, even though Mrs. Jones has many other pressing needs for these funds and is not sure how she will manage (e.g. the home is in need of major repairs, tuition fees for the children’s education are due to be paid, funeral costs must be paid, and day to day expenses are building up).

It would have been especially advantageous not to pay off the entire mortgage if they had obtained a low interest rate.

CBC’s Marketplace highlighted some of the hidden dangers of mortgage insurance. We invite you to watch their eye-opening report entitled “In Denial.”

3 Reasons to Choose St. John’s Life Insurance

1. We work directly with over 18 Leading Canadian Insurance Carriers
2. We are able to find you the lowest premiums on the market
3. We offer a complete range of plans to suit any need and budget

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