Mortgage Redemption Insurance
Mortgage Redemption Insurance – If somebody takes a house loan with a bank, the bank needs some security on the loan amount.
What if something happens to the person during the loan period?
How will the bank recover that balance outstanding loan amount?
Here comes the need for Mortgage Redemption insurance. Let us briefly discuss.
What is Mortgage Redemption Insurance?
Mortgage Redemption is an insurance policy that provides financial protection for home loan borrowers.
It is basically a decreasing term life insurance policy taken by a mortgagor to repay the balance on a mortgage loan if he/she dies before its full repayment.
It can be called a loan protector policy.
This plan is suitable for elderly people whose dependents may need assistance in clearing their debts in case of the unexpected demise of policyholder.
The policy bears on surrender value or maturity benefits.
The insurance cover under this policy decreases each year, unlike a term insurance policy where insurance cover is constant during the policy period.