Life insurance guide

Mortgage protection insurance

Mortgage protection is a life insurance policy sized to your mortgage that pays your family, not the bank, if you die. It keeps them in the house while they decide what comes next.

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What it is

Mortgage protection is a life insurance policy sized to cover your mortgage payments for a defined period, typically 12 to 36 months, if the main earner dies.

It doesn't replace traditional life insurance. It solves one specific, immediate problem: keeping your family in their home during the hardest period of their lives.

When someone dies, the family faces a hundred decisions at once. Where to live shouldn't be one of them. Mortgage protection buys them time to grieve and decide without a foreclosure clock in the background.

How it works

Built to match the exposure.

Sized to your mortgage

The amount is based on your balance or a set number of months of payments, not a generic formula.

Pays your family, not the bank

The benefit goes to your beneficiaries. They decide: pay the mortgage, pay off the house or cover other costs.

Standalone or layered

On its own, or on top of existing coverage. Many families have term for income and a separate policy for the house.

Who it suits

Who should look at it.

Homeowners with dependents

If anyone relies on your income to keep the house, they need protection if that income stops.

Anyone with a mortgage

First home or third, if there's a balance, there's a risk.

People relying on bank cover

PMI protects the lender. Bank mortgage insurance pays the bank. Your family gets nothing from either.

People whose life insurance wasn't sized to the house

Your term policy may cover income. Has anyone checked it covers the mortgage for long enough?

Cost

What it costs.

A $150,000 mortgage protection policy for a healthy 35-year-old typically runs $35–65/month. The exact number depends on your age, health and term length.

Coverage and pricing depend on underwriting, eligibility, state availability, and carrier approval.

Compared

Bank cover and private protection.

Topic	Bank or PMI cover	Private mortgage protection
Who gets paid	The lender	Your beneficiaries, directly
Your family's choice	None, it goes to the loan	Pay it off, keep paying, or use it elsewhere
What it protects	The bank's exposure	Your family staying in the home

Before you decide

What people get wrong.

"My PMI covers this."

PMI (private mortgage insurance) protects your lender if you default. It doesn't pay your family anything if you die. Different products, different problems.

"My term policy covers the mortgage."

Maybe. A $500K term policy against a $350K mortgage leaves $150K for income replacement, debts and college. That gets tight fast, and if you bought it five years ago, your balance and your family's needs may have changed.

"I have mortgage insurance through my bank."

Bank-offered mortgage insurance pays the remaining balance to the bank. You pay premiums for a policy that benefits your lender. Private mortgage protection pays your beneficiaries directly.

Questions and answers

What people ask us.

How long does the payout last?

It's sized to cover a defined window, typically 12 to 36 months of payments, so your family isn't forced into a housing decision while grieving. It can also be sized to pay off the balance.

Isn't this just term life by another name?

It's term life scoped to one job: the house. People often pair it with a larger term policy for income. The point is making sure the mortgage specifically is covered for long enough.

Does the money have to go to the mortgage?

No. The benefit goes to your beneficiaries, not the bank, so they decide: pay off the house, keep up payments or cover other expenses.

Related guides

Find out if your home is protected.

Thirty minutes, no obligation. You'll know where your family stands on the house.

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