New baby or new home? Compare the bank’s mortgage insurance with term life.
When you sign a mortgage, your lender may offer mortgage life insurance. It’s optional. Before you say yes, compare it with personal term life insurance, which can protect your family, not just the loan.
No obligation. Nothing changes without your approval.
- Mortgage vs. term, explained
- English or French
- Weekends available
- No obligation
The key differences
Who gets the money
With the lender’s mortgage life insurance, the lender is the beneficiary. With term life, you name the beneficiary, and they can use the money for anything.
What happens to the amount
Mortgage life coverage goes down as you pay off the mortgage, while premiums generally stay the same. A term policy’s death benefit stays the same while it’s in force.
It’s your choice
Your lender can’t make you buy its insurance to get the mortgage, and you can cancel it.
Questions to ask before you sign
- Who receives the money if I die: the lender or my family?
- Does the coverage go down as my mortgage balance does?
- When are my health answers checked: when I apply, or only when a claim is made?
- Can I keep the coverage if I switch lenders or move?
- Would it also cover income, childcare and other costs, or only the mortgage?
How it works
- Send a short requestPick a time for a call and add documents if you have them. It takes a few minutes.
- Frank reviews and comparesA licensed broker looks at your situation and compares options.
- You decideTalk it through by phone. Nothing changes without your approval.
How much coverage do you need?
Read our guide, How much life insurance do you need?, and the Financial Consumer Agency of Canada’s page on optional mortgage insurance products.
What to have ready
- Your mortgage amount and length
- Any life insurance you already have, including coverage through work
- Your approximate income and other debts
- Your children’s ages, if you have children
Don’t have everything? Send what you have and Frank will ask for the rest.
Common questions
Is the bank’s mortgage insurance a bad idea?
Not necessarily. It’s simple and convenient. But it only pays off the mortgage, and the lender is the beneficiary. Comparing it with term life shows you the trade-offs.
How long should a term policy last?
Many families choose a term that covers the years of the mortgage and of raising children, such as 20 or 25 years.
Isn’t my coverage through work enough?
Group life insurance helps, but it’s often one or two times your salary and usually ends if you leave the job.
Will I need a medical exam?
It depends on your age and the amount. Many applications start with health questions, and some need an exam or blood test.
Protect your family, not just the loan
Start with a short request. No obligation, and nothing is applied for without your approval.
Prefer email? Write to Frank.tereraho@insureu.ca.
More reasons to review your insurance
Sources: Financial Consumer Agency of Canada: optional mortgage insurance
Life insurance is offered by Frank Tereraho as a life insurance agent licensed in Ontario, through InsureU Brokers Inc., 135 Laurier Ave W, Ottawa, ON. This page is general information, not financial, tax or legal advice. Coverage, pricing and eligibility depend on each insurer’s underwriting and policy wording.