Benefits of iA mortgage insurance

Mortgage insurance is a crucial consideration for homeowners in Ontario, providing financial protection for your mortgage in unforeseen circumstances. iA Financial Group offers mortgage insurance products designed to meet diverse needs, often presenting advantages over policies provided directly by lending institutions.

There are many advantages to insuring your loan with iA Financial Group that your loaning institution doesn’t offer:

• You’ll keep your mortgage insurance even if you switch lenders when you renew your mortgage.
• You own the contract and choose your beneficiaries.
• Your premium is set based on your personal profile and will not increase, even if your health condition worsens.

Understanding iA Financial Group’s Mortgage Insurance

iA Financial Group provides two primary mortgage insurance options:

• Pick-A-Term: This policy allows you to cover your mortgage and other financial commitments under a single plan. You can select a term ranging from 10 to 40 years, with premiums that remain constant throughout the chosen period. Additionally, there’s an option to convert this term insurance into permanent life insurance at any time.
• Universal Loan Insurance: This coverage assists in repaying your debts partially or fully if you experience a disability. It’s available to both homeowners and tenants, ensuring that your financial obligations are managed during periods when you’re unable to work due to health issues.

Benefits of Choosing iA Financial Group Over Lender-Provided Insurance

Opting for mortgage insurance through iA Financial Group offers several advantages compared to insuring your mortgage directly with your lending institution:

• Policy Ownership and Beneficiary Flexibility: With iA Financial Group, you own the insurance contract and have the freedom to designate your beneficiaries. In contrast, lender-provided policies often make the lender the beneficiary, limiting your control over the policy.
• Portability of Coverage: iA Financial Group’s mortgage insurance remains intact even if you decide to switch lenders upon renewing your mortgage. Lender-specific policies typically terminate if you change financial institutions, necessitating new coverage.
• Stable Premiums: Premiums with iA Financial Group are determined based on your personal profile and are guaranteed not to increase, even if your health condition changes over time.
• Comprehensive Coverage Options: Beyond just covering your mortgage, iA Financial Group offers policies that can encompass other financial obligations, such as car loans or lines of credit, providing a more holistic financial safety net.

Key Considerations

When evaluating mortgage insurance options, it’s essential to assess your personal circumstances, financial goals, and the specific terms of each policy. Consulting with a financial advisor can provide personalized insights to help you make an informed decision that aligns with your needs.

When evaluating mortgage insurance options for a $200,000 mortgage in Ontario, it’s essential to compare the offerings from iA Financial Group and traditional lending institutions. Here’s a numerical breakdown of the differences, along with the pros and cons of each:

PREMIUM CALCULATIONS

iA Financial Group:

• Premium Determination: Premiums are based on factors such as loan amount, type, term, number of insured persons, their age, and chosen coverage.
• Specific Rates: Exact premium rates aren’t publicly disclosed, making it necessary to consult directly with iA Financial Group for precise figures.

Lending Institutions (e.g., RBC Royal Bank):

• Premium Determination: Premiums are calculated based on the borrower’s age and the initial insured mortgage balance.

Example Calculation:

• Age: 35 years
• Mortgage Amount: $200,000
• Premium Rate: $0.24 per $1,000 of the initial mortgage balance
• Monthly Premium: ($200,000 ÷ $1,000) × $0.24 = $48 per month (plus applicable taxes)

PROS AND CONS

iA Financial Group:

Pros:

• Portability: Coverage remains intact even if you switch lenders upon mortgage renewal.
• Policy Ownership: You own the contract and can designate beneficiaries, offering greater control.
• Stable Premiums: Premiums are based on your personal profile and remain constant, even if your health condition changes.

Cons:

Lack of Public Rate Transparency: Specific premium rates aren’t readily available, requiring direct consultation for exact figures.

Lending Institutions:

Pros:

• Convenience: Easier to set up as it’s integrated with your mortgage application process.
• Transparent Rate Structure: Premium rates are often publicly available, allowing for straightforward calculations.

Cons:

• Non-Portability: Coverage typically ends if you refinance or switch lenders, necessitating new insurance.
• Beneficiary Limitations: The lender is usually the beneficiary, limiting flexibility.
• Premium Variability: Premiums may increase upon mortgage renewal, especially if your age or health status has changed.

Choosing between iA Financial Group and a lending institution for mortgage insurance depends on your priorities. If you value portability, policy ownership, and stable premiums, iA Financial Group may be the preferable option. However, if convenience and immediate rate transparency are more important, a lending institution’s insurance could be more suitable. It’s advisable to obtain personalized quotes from both providers to make an informed decision tailored to your financial situation and preferences.

In summary

In summary, while both iA Financial Group and lending institutions offer mortgage insurance, the flexibility, control, and comprehensive coverage provided by iA Financial Group make it a compelling option for many homeowners in Ontario.