01
Match coverage to your mortgage and lock the premium
Face amount and term are sized to your loan balance and remaining years. Premium is locked for the life of the policy.
What it is
Coverage built around your home loan, with living benefits that pay during chronic, critical, and terminal illness, plus an optional refund if you outlive the term.
A mortgage is the biggest debt most families ever carry. Mortgage protection is built to keep that debt from becoming a crisis, whether the household loses a breadwinner or one of you faces a serious illness that disrupts income.
Coverage is sized to your home loan and includes living benefits for chronic, critical, and terminal illness. On a qualifying diagnosis, a portion of the benefit can be paid to you while you are alive, keeping the mortgage current when you need it most. Many policies also offer return of premium, refunding what you paid if you outlive the term.
How it works
The mechanics, in plain language.
02
Living benefits activate on a qualifying illness
A heart attack, stroke, cancer diagnosis, or chronic-illness diagnosis triggers an advance of a portion of the benefit to you, while you are alive.
03
Death benefit pays off the mortgage
If you pass during the term, your beneficiary receives a tax-free lump sum that can be used to pay off the mortgage in full.
04
Optional return of premium refunds what you paid
If you outlive the term and never file a claim, the return-of-premium rider refunds every premium you paid into the policy.
Fit
Is this product right for you?
Likely a good fit
- Homeowners with a mortgage and dependents
- Single-income households where losing the breadwinner would put the home at risk
- People worried about losing their home to a serious illness, not just to a death
- Buyers who want term life with living benefits built in (critical, chronic, terminal illness)
- People in their 30s through 50s during peak earning years
Probably not the right fit
- Renters or homeowners who own their home outright
- People without dependents
- Buyers wanting permanent coverage that builds cash value
- Anyone who already has comprehensive disability insurance plus term life sized to cover the mortgage
Key terms
The vocabulary you'll hear.
- Face amount
- The death benefit, what your beneficiary receives if you pass during the term.
- Level term
- The death benefit stays constant for the full term.
- Decreasing term
- The death benefit drops over time, typically tracking the declining mortgage balance.
- Return of premium
- An optional feature that refunds every premium you paid if you outlive the policy term.
- Living benefits
- A category of benefits that pay a portion of the death benefit during your lifetime on a qualifying diagnosis. Most mortgage protection policies cover three types:
- Critical illness
- Pays a portion of the benefit on a major diagnosis such as heart attack, stroke, cancer, or major organ failure.
- Chronic illness
- Pays a portion of the benefit when you are unable to perform two or more activities of daily living, or have a severe cognitive impairment.
- Terminal illness
- Pays a portion of the benefit when a doctor certifies a limited life expectancy.
FAQ
Common questions
Why not just buy regular term life?
Regular term life pays a death benefit only. If you survive the term, there is no payout. Mortgage protection policies emphasize living benefits: most include critical-illness, chronic-illness, and terminal-illness riders that pay a portion of the benefit while you are alive on a qualifying diagnosis. They also commonly offer a return-of-premium option that refunds every premium you paid if you outlive the term. Both features mean a mortgage protection policy can pay out in situations where standard term cannot.
How do the living benefits actually work?
On a qualifying diagnosis, the insurer advances a portion of the death benefit to you while you are alive. The percentage varies by policy and severity, often 25% to 100% of the face amount. The funds can be used however you choose, to keep the mortgage current, pay medical bills, or replace lost income during recovery. If you later pass away, the remaining death benefit (face amount minus what was advanced) goes to your beneficiary.
Does the bank get the payout?
No. The beneficiary you name receives the death benefit. They can choose to pay off the mortgage with it or use it however they like.
What if I refinance or pay off the mortgage?
The policy continues as long as you pay premiums; it is not tied to the loan. If you pay off the mortgage early, you can keep the coverage, drop it, or in some cases convert it to permanent coverage.
Are medical exams required?
It varies by policy. Simplified-issue policies do not require a medical exam, while fully underwritten policies may require one and can offer lower rates. Your agent can walk you through which fits your situation.