Life insurance has always been an important part of a financial plan for Canadians. Some Canadian life insurance companies have been around since the late 1800 and 99.9% have never failed to pay a claim. Life insurance pays upon the death of the insured and we all have an expiry date.

Recently Canadian banks have taken a more aggressive stance on entering the life insurance market. Certain banks now have great products and I welcome them to the market place. In fact our company sells life insurance for a couple of the "big five" and often they are a great solution.

However, when you’re getting coverage for your mortgage certain products offered by the banks are far inferior compared to what the more traditional life insurance companies offer.

With most mortgage insurance offered to a bank customer (who is getting a loan for a home), the death benefit follows the amortization schedule of the loan. This means that the coverage goes down as you pay off your debt. Your benefit goes down but the price you pay stays the same. A gap is created.

This gap is great for the bank as their obligation or payout drops as you pay them back. The customer’s beneficiary or estate loses out on what most people assume would be a fair policy or practice.

Buying a house is an emotional time for most buyers and they don't want anything to go wrong on the most important purchase of their life.

Banks play on your emotions and hold you as captive.  I recently purchased a new home and even though my Bank has known me for years and know very well that I sell life insurance, they pushed their products on me. When I refused coverage I needed to sign five different pages, wait and waste my time as my "personal banking" officer needed to make copies, see the manager of the branch, and possibly take a DNA sample (just kidding about the DNA) for me to get out of paying for a product that I know was more expensive and offered less coverage then I could get from as many as 20 different insurance companies in Canada.

At a certain point I felt that the loan I was getting was in jeopardy if I continued to refuse to buy their life insurance (and also what they call "mortgage disability").

As you can imagine I did not take the mortgage insurance offered by the bank, and I still got my loan.

I would advise all Canadians to refuse the bank’s offer until they have at least checked out what else is available. Trust me, if you are approved for a loan, the bank won’t take it back if you refuse their insurance products.

It is real easy to get life insurance quotes at our web site. You can instantly see offers from many competing insurance companies and even apply online or over the phone!

Ian Baker,
President,
HealthQuotes.ca Inc.
www.life-insurance-quotes.ca