Hello, this is Chad McMahan with Protect With Insurance, this is another life insurance episode. This one is specific to mortgage protection insurance. And the topic for this one is, do I need mortgage protection, insurance?
Well, I’m going to dive into that and as always, I want this to be short and sweet as possible to answer that question, to really help you understand how it works, which is an important part of answering that question. And then to help you best I can, even though this is to a large audience to help you determine if it’s something that would be not only helpful to you, but essential to you and your family. So the first thing is what is mortgage protection insurance also known as mortgage protection.
It is a term structured life insurance policy that is built from the ground up to be at least enough to pay off the mortgage upon your death, but also in the event that certain living benefits are triggered. So first, let’s talk about death. Any death, they’re going to send the full amount. The next thing is any money that’s paid by the insurance company with your policy is tax free. When it’s structured this way, when it’s built his term life insurance, it’s totally tax free.
Another reason why it’s built this way and it’s term structured is that that’s how mortgages work. Mortgages don’t last forever. Usually the 30 years I’ve seen five year mortgages, I’ve seen anywhere up to 30. And I’ve seen one or two year mortgages, too. But that’s another story.
So with these policies, with these mortgage protection policies, it’s going to be tax free. It’s going to pay for any death. And now we’re going to talk about living benefits depending upon the insurance company and program. That’s the best fit for you, because largely it’s going to depend upon your health and it’s going to depend upon your age. It’s also going to depend upon the size of your mortgage and what company, which insurance company and which program that we go with is the best fit for you, because the goal on our side is going to be save you money and get you the best program possible.
Because there are huge differences between the different companies and also the different programs that they offer. And so we’ve done this so, you know, a long time we have the expertise. We can we can pair you with the best option possible and save you some money, save you a lot of money, typically. So living benefits are usually going to be if you get diagnosed with a chronic medical condition, chronic COPD, chronic bronchitis, something like that, depending upon the program, depending upon the company, that’s going to pay 70 percent of the total policy amount or maybe all the way up to one hundred percent the total policy amount.
Again, this depends on your age, depends upon your health. But if you are in excellent health or even kind of average health average or a little bit better health, typically you can get 100 percent coverage on chronic medical conditions. This is very important because chronic is something that is moderately common and it’s becoming the trend medical trend because our our country is has a health crisis and we’re seeing the health trend is not good. Health is decreasing across the country and it’s becoming very, very normal for folks my age that are in their 40s, 30s.
I’m in I’m 40 but 40 30s to see anxiety meds, depression, meds, diabetes, things like that. That’s becoming the new normal heart issues. So we’re certainly seeing that in the 50s and 60s. And again, that trend is just continue down. So having that chronic coverage is very important. Also terminal, you know, almost all of them are paying one hundred percent for terminal diagnosis. So, again, you’re still alive. Doctor says, sorry, you’ve got a year or less to live in some cases two years or less to live.
They send the whole bit. So let’s say it’s a three hundred thousand dollar mortgage protection policy. They said the three hundred thousand dollars to you while your live tax free right away, you know, and then you pay off the mortgage. If there’s anything left over from that three hundred grand, then that’s yours. Tax free. You can use it for whatever you need it for.
Another living benefit that is really important in a lot of carriers are going to stop offering this over time, over the next however many years. But they’re going to stop offering this because it’s becoming so incredibly common with health issues as we get into our 50s, especially 60s, 70s on up is critical health conditions. Now, most carriers define this so loosely that it includes things like heart attacks and strokes, things like that. It’s becoming a lot more common.
So if you get a critical condition, some of these programs, they’re going to send one hundred percent, they’re going to send the whole thing. Some of these programs, they cap it at one hundred thousand dollars in tax free, a hundred thousand dollars. So these living benefits, it’s very, very important because, yes, the death benefit you want that that is built in, built in everything that we do. But the living benefits with these mortgage protection policies, it is so important because it’s much more likely the math of it is that that is more likely to benefit you.
So it’s very important that it’s in your policy. So now that you’re kind of starting to get a little bit of it, I know it can feel like a lot to me, it’s very simple. This is what I do. But I know it can feel like a lot. So let’s just think about this simply. You’ve got your living benefits of something. You get diagnosed with a whole bunch, these different conditions. Ipis, you got your death benefit.
You die for any reason it pays. There are some other things that are in there as well, but those are the main things, was letting benefits those death benefits. Any of those things and the policy pays, so then the question is only for you to answer. I can’t pretend to answer that question for you if it’s something that you need, if mortgage protection is something that you need. Most people agree that when you have a home, you have a mortgage.
It’s incredibly it’s crucially important to make sure that you eliminate that risk of homelessness and foreclosure and all of that. I’ve seen it happen too many times. It’s awful. And so this is a way to protect against that. This is a policy that’s dedicated to pay off that mortgage so that it’s owned Tax-Free free and clear. I mean, that’s it’s a beautiful thing. It’s so, so important.
So if you have more questions, if there’s anything we can do for you, please just reach out to us. You can email us. Hello. At Protect with insurance dotcom, you can call us or text us at ninety eight three two three zero nine three three. And if you do text us there, you’ll be assigned to one agent. You’re not going to be bombarded with a bunch of text. So it’ll be one agent that would answer your questions and help you out.
If you call in the same thing, you’ll be assigned to be helped by someone. So help. This has been helpful. Any other mortgage protection, insurance questions or anything else? Please just let us know. Thanks a lot and stay safe out there.