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MORTGAGE PROTECTION PLAN |
A mortgage protection plan is
a customized life insurance protection plan with
enhanced options to cater for the needs of new
or existing home owners who intend to finance or
have financed the purchased of their home
through a mortgage/loan. It is therefore a
contract in which an insurance company
guarantees the payment of a large agreed sum of
money to your survivors (or designated
beneficiaries) upon your death. In return, you
pay a relatively small regularly scheduled
payment known as the insurance premium.
The goal of mortgage
protection plan is to protect your loved ones
from the hardship that they may face if you die
and they are left with no funds to make the
mortgage payments. A mortgage protection plan
will also protects your assets (such as your
house) from being foreclosed/taken over by the
mortgage company because your family can't
maintain the mortgage payment.
Benefits that may be required by mortgage
companies may include: permanent total
disability, critical illness, and waiver of
premium.
The plan is very flexible allowing you to pay
the premium monthly, quarterly, semi-annually,
yearly or a lump-sum payment in a variety of
currencies (USD, GBP, EUR, etc.)
Working
Scenarios (Mortgage Protection)
The Jones family purchased their dream home for
$600,000, Mr. Jones made a $60,000 down payment
and financed the remaining $540,000 through a
mortgage. He also invested in a $1,000,000
mortgage protection plan in 2002 when he was 38
years old. In 2007, Mr. Jones and his family
were involved in a traffic accident, they were
all hospitalized for two weeks after which Mr.
Jones passes away and was survived by his wife
and two daughters. Mrs. Jones and her two
daughters (the assigned beneficiaries) receive
$1,000,000 from the insurance company. Mrs.
Jones pays all the medical bills for the whole
family, the burial fees of her beloved husband,
and all outstanding mortgage amount, loans, and
credit card balances. She uses the remaining
amount to maintain the same standard of living
for the family and to setup an educational plan
to cover for the college education of her two
daughters.
Now lets look at the same example above assuming
that the Jones family did not have a mortgage
protection plan.
The Jones family purchased their dream home for
$600,000, Mr. Jones made a $60,000 down payment
and financed the remaining $540,000 through a
mortgage in 2002 when he was 38 years old. In
2007, Mr. Jones and his family were involved in
a traffic accident, they were all hospitalized
for two week after which Mr. Jones passes away
and was survived by his wife and two daughters.
Mrs. Jones uses all the family savings in paying
the medical fees for the whole family and the
burial fees of her beloved husband. She is left
with no fund to pay for outstanding loans,
credit cards, mortgage payments, school fees,
living expenses, etc. The mortgage company will
foreclose the dream home of the Jones and the
standard of living of the Jones have been
severely put off course.
Facts that Can't Be
Ignored
According to the World Health Organization, 58 Million
people (more than all the population of the U.K.) died
in 2005. The three leading causes of death were:
1. Cardiovascular Diseases
(Heart Disease and Stokes)
- Cardiovascular Diseases are the
number one cause of death globally.
- An estimated 17.5 million people
died from Cardiovascular Diseases in 2005.
- By 2015, almost 20 million
people will die from Cardiovascular Diseases, mainly
from heart disease and stroke.
2. Cancer
- More than 7.5 Million people
died of Cancer in 2005.
- The most frequent cancer types
among men (in order of number of global deaths):
lung, stomach, liver, colorectal, oesophagus and
prostate.
- The most frequent cancer types
among women (in order of number of global deaths):
breast, lung, stomach, colorectal and cervical.
3. Pulmonary Diseases (Lung Disease)
- An estimated 80 million people
have moderate to severe pulmonary disease.
- More than 3 million people died
of Pulmonary Diseases in 2005.
- Total deaths from Pulmonary
Diseases are projected to increase by more than 30%
in the next 10 years.
* Source: The World Health
Organization (An Agency of the United Nation).
Given the figures above and
the chances that any one of us will be one those in
the statistics, it is easy to recognize the
importance and the need for mortgage insurance
protection.
Request
a Free Quote Now
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Here
to Request a Free Mortgage
Protection Quote
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