Same Goal, Very Different Products

Mortgage life insurance and term life both protect your family from your mortgage if you die — but they are priced and shaped differently. Lender-sold mortgage life pays only the remaining loan balance, so the benefit shrinks toward zero as you pay down the mortgage, yet its premium is typically two to three times what a level term policy costs for the same initial coverage. A level term policy keeps a flat death benefit for the whole term, costs far less per dollar of coverage, and pays your beneficiaries directly, who can then settle the mortgage or use the money however they need. This comparison uses typical non-smoker term rates by age with a standard 2.2× mortgage-life markup — replace both with real quotes for an accurate decision.