Why You Need Mortgage Protection Insurance
Financial experts applaud the benefits of a monthly family budget. However, no matter how well you follow its guidelines, losing a contributing income would make it very hard to meet all your obligations. Usually, the largest expense is the mortgage on your home. If your family loses a source of income, could you keep the house? That is why mortgage protection is so important.
The downside of life insurance is that it forces you to face the reality that you, or someone you love, may die unexpectedly. The upside of life insurance is that it protects your family even if a tragedy occurs. In this world where two-income families are the norm, would you be able to pay your mortgage if your income was cut in half?
Mortgage companies require homeowners to have insurance to protect the companies’ risk. A homeowner’s policy protects you if you suffer a loss from circumstances such as fire, theft or Mother Nature. However, it will not cover your home if a portion of your family income is lost.
That is why Indiana Farm Bureau Insurance provides options to help you protect your mortgage. The Mortgage Protector and Mortgage Protector Plus plans provide security and peace of mind in case a tragedy strikes your family.
The plans are simply a life insurance policy that acts like a savings account. You pay into the policy for a set number of years and either receive the benefit of the policy in the event of a death or receive a refund of premium paid at the end of the term.
“I encourage my clients to get this policy,” says Janella Newcomb, insurance agent in Vanderburgh County. “It’s not just life insurance but a forced savings account that protects your home.”
Should you outlive the term of the policy, you can use the money to pay down your mortgage or for anything else that you need.
“Life happens, and maybe at that time, paying down your mortgage isn’t a priority,” says Michelle Dilling, manager of life products. “Maybe sending your child to college is a bigger priority. You can use the money however you see fit. We provide much more flexibility than the bank does.”
That flexibility is key to this product. Banks also offer mortgage protection, but the bank is the beneficiary. At the time of a loss, the money does not go to your family, removing any flexibility they have in regards to how to use the money.
The best part of a Mortgage Protector policy, according to Newcomb, is “you control the money.”
The policy is beneficial for anyone with a mortgage, and those with little time left on their mortgage could use the money for other life events.
“I took out this policy myself,” Newcomb says. “My husband and I like to ride motorcycles, and hopefully, in 20 years, we’ll get the return of premium and take one heck of a ride.”