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Could you pay your mortgage if you were suddenly disabled?

May 6, 2011

When you take out your mortgage, the bank forces you take out fire insurance to protect the value of your home should it burn down. This way the bank protects their investment in your home. Your ability to go out and generate an income is one of the most valuable assets you provide your family. Did you know that you are more likely to become disabled than you are to have your house burn down? Let’s face it, serious illness and accidents do happen, and disability is a leading cause of bankruptcy.

Disability Insurance is a way to protect the financial security of you and your family if you become temporarily or permanently unable to work. This is especially important if you’re self-employed or don’t have coverage through your employer. Since most employer plans don’t replace your full income, many people purchase additional coverage.

Unlike Critical Illness Insurance which provides a lump sum payment right away regardless of what other coverage you may have; disability benefits are paid monthly, there’s often a waiting period (for instance, 90 days) before benefits kick in, and benefits can be reduced if you have other income.

Disability insurance premiums vary based on your age, occupation, health, and pre-existing conditions. Premiums rise if you choose higher monthly benefits or a shorter waiting period, or if you specify a wider range of potential disabilities.

Along with our mortgage products, MonsterInsurance.ca is available to offer a range of insurance options for you and your family based on your individual needs, not the bank’s! Remember, while your home is your family’s most valuable asset your mortgage is your bank’s. Make sure you are protected. You will appreciate the peace of mind of knowing you and your family can still meet your mortgage payments in case of accident, sickness, critical illness or loss of life.