How much you pay for your mortgage insurance premiums will hinge largely on three factors. Even with the same policy, the premiums can be different based on how large the mortgage is, how old the insured is, and whether it is a smoker.

Both kinds of mortgage insurance-life to pay off the mortgage, or disability to pay mortgage payments-use these three things to calculate the premium.

Since the age and condition of the insured is one of the most critical determinants of when a policy will be paid, they are the most important determinant of the premium. A great many mortgage insurance policies do not even need a physical. This can be chancy, since any statement that would infer good health can be used negatively if the claim is processed and it turns out a health condition (or smoking) was hidden. Don’t think you can claim to be a non smoker and then collect on the insurance because the insurance company didn’t realize. They will know, and if you have made incorrect statements on the application, you may jeopardize the entire insurance.

Recognizing this limitation, many companies now offer Regular (for smokers) and Non-tobacco, which is for applicants who do not now use tobacco or have not used it within the prior twelve months period. The smoker’s policy is of course going to be higher than the non smoker’s.

Keep in mind that insurance policies that are available without a physical have previously priced the additional risks into the premium. So those who are in very good health should consider taking the physical to see if lower premiums are available for him.

These factors can have a great effect on premiums, and the premiums for a 50 year old, with the same size mortgage, will be more than twice as much as that of a 38 year old. Lowering the loan amount insured will not change the premium that much. None of this is surprising, because the insurance business is based on increasing the collection of premiums and putting off paying of policies.

The mortgage figure has an affect at a given level, however. But up to about $250,000, the savings are low per each $10,000 difference in value. Larger mortgages need a higher premium and the insurance company will also insist on an assessment to prove the value of the property.

Related posts:

1. Toronto Term Life Insurance: Finding the Best Mortgage Life Insurance Quote
2. Mortgage Insurance In BC: How to Decide on Mortgage Disability Insurance
3. When Choosing Philadelphia Home Insurance
4. Understanding Your Illinois Homeowners Insurance Policy
5. The Best Mortgage Protection Insurance

Tags: home, insurance, Life Insurance, mortgage, mortgage life insurance, Mortgages, real estate

This entry was posted on Monday, June 29th, 2009 at 4:44 am and is filed under Mortgages. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.