Decreasing Life Insurance Georgia GA
Reader’s Question:
I want to get a life insurance policy that can pay off my mortgage balance upon my death. What life insurance policy do you suggest?
Peter
Columbus, GA
If you are looking for a mortgage protection policy, your choices are decreasing term life insurance, level term life insurance and whole life insurance policy.
The decreasing term life insurance is also known as the basic mortgage protection life insurance and is the most popular mortgage insurance protection. With this type of term life insurance policy, the premiums are level in the entire life of the policy and death benefits are decreasing in the same manner as the mortgage balance. With decreasing term life insurance policy, the face value will be the same or higher than the amount of the mortgage balance.
Level term life insurance policy is also used as mortgage protection insurance in some cases. For example, a 10 year term policy can be used to pay your 10 year mortgage payments. Upon your death, the life insurance company will pay off your due mortgage balance with the bank.
The cash value in whole or permanent life insurance policy can also be used to pay off your mortgage balance. While you are still alive, this cash value builds up over the years. There are types of whole life insurance policy to choose from. These are universal life, variable life and variable universal life insurance policy. The whole life insurance policy though has a higher premium than that of term life insurance policy.
Tags: term life insurance, whole life insurance
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