Bought a house and got a question (NF)

[fishinggeek]

I am against any insurance in general and only buy them when have no other choice...like car insurance....about to renew my mortgage and have never had /will never have insurance on it. Better spend the same amount on paying your mortgage faster

 

Congratulations on the new house!

 

Cheers,

Ice Fisherman

 

I am exactly the same way. For an insurance policy to be profitable, it must be actuarially fair or better, which inevitably means the consumer loses something to buy "peace of mind". By avoiding insurance altogether, we will all be more wealthy, on average.

[kickingfrog]

Hi Joey, I only read the first couple of responses so I might be covering some of the same ground here.

 

Don't go with the bank's option. The basics are the banks owns the policy and you pay the premium (good for the bank, bad for you). As stated the bank (if it does pay out in the unfortunate circumstance) will only pay off the balance of the mortgage, your premiums were based on the full amount borrowed(good for the bank, bad for you). A term policy through a life insurance company is owned by you and is based on your health at the time it is written. If your health situation changes the policy is still valid. If your bank owns the policy they may not allow you to continue when your mortgage is renewed (or the new premiums will be based on your new heath situation (good for the bank, not good for you)).

 

Term insurance is cheaper than permanent insurance and is best used for temporary situations (mortgages, business loans and raising young children). In many cases you can switch all or part of your term policy to permanent at a later date and again it is based on you original health situation.

 

Disability is much more grey. Get your life insurance situation taken care of first and foremost. If after that, if you think you want/need/ can afford disability insurance get it through an insurance company, not the bank and talk about the options.

 

Insurance is not a fun topic, no one likes thinking about it. It is necessary however.

 

In short: get term through an insurance company. If you include house, car and mortgage through one company you can save some cash as well.

 

I would have responded sooner, but I was fishing.

 

Rob