Lawyers looking to insure the investment in their homes may find life insurance a cheaper and more flexible option than the more traditional mortgage insurance, says Dawn Marchand, the vice-president of marketing and direct distribution for the Canadian Bar Insurance Association (CBIA).
“Life insurance is the cheaper option and it also gives survivors more control over the money,” Marchand tells AdvocateDaily.com.
While neither option is required when financing a new house with at least a 20 per cent down payment, many homebuyers rest easier knowing that their loved ones can continue to live in the family home should they die before the mortgage is paid off.
Although mortgage insurance will pay off the mortgage, that’s about all it will do, says Marchand.
She uses the example of a 41-year-old man buying a house. He qualifies for a $750,000 mortgage through the bank and he’s offered mortgage insurance for $217 a month. Marchand says this 41-year-old non-smoking man could get term life for $750,000 through the CBIA for only $42.50 per month.
The savings for women are even greater. A 41-year-old female non-smoker would still pay $217 for mortgage insurance, but her CBIA term life premium would only be $31.63 per month.