When it comes to Mortgage Life Insurance in Canada, there are two main ways to set it up.

So which of these two ways is better? Well, depends who you’re asking for. If you buy the mortgage insurance from the bank, it is better for the bank. If you are asking what’s better for me, then off course it is better to buy the term insurance yourself.

Here are a few problems with the insurance from the bank:

• You don’t own the policy and have no control over it. That means that the policy could be cancelled without your consent, the premium could increase, basically, you really have no control.
• You can’t name a beneficiary. That’s right, guess who is the beneficiary? Yes, it’s your bank or lender. When you buy a real policy, you can name the beneficiary, and they will get the pay out, and can actually keep the balance, if there is any money left over, and there usually always is.
• The premium can be up to 100% higher than when you buy your own mortgage insurance, especially if you are a non-smoker. You see, the banks treat all people the same, whether you are a smoker or non, you get the same rate. When you buy your own mortgage insurance, you will be rewarded with better rates, if you are a non-smoker, or even just in better than average health.
• The Coverage decreases. That’s right, the coverage at the bank mortgage insurance goes down as you are paying off your mortgage, but the premium stays the same. When you buy your mortgage insurance yourself, the coverage stays the same for the whole term. That way your beneficiary can keep the difference and use it for something else.

So there you have it, you can get a cheaper policy, that is better, and more coverage if you go outside of your bank.

We suggest that if you are looking for mortgage insurance , that you shop all Canadian Life Insurance Companies and find one that suits your needs. The calculator on this site will do a comparison of many insurers in Canada, and give you prices and information.

Please feel free to use it.