Condo insurance

[endlssorrow]

Can check roughly how much? Any recommendation to take other than this Chubb

 

[moejoseph]

Can check roughly how much? Any recommendation to take other than this cuppa

I supposed u are talking about Fire and All Risk + home content insurance? The premium will depend on the coverage amount you are looking at.

You may check out the link below for a rough quote, before comparing with other insurers.

http://bit.do/AXAHomeInsurance

 

[SBC]

Or is it mortgage insurance?

 

[endlssorrow]

Or is it mortgage insurance?

Not that....wait .... share more?

 

[chopra]

mortgage can use aviva 1 million term for private? public hdb can and i am using it to pledge that i have sufficient coverage instead of home protection scheme.

 

[moejoseph]

Not that....wait .... share more?

Mortgage insurance is a type of insurance that is designed to protect your mortgage loan against the event of a life changing event in your life, like death or TPD whereby a person can no longer (work) to pay off the housing debt. Usually it is a decreasing term plan as it is cheaper, though people can choose to use a normal term plan or any other coverage in replacement.

Usually for HDB, they have got a compulsory Home Protection Scheme (HPS) which they require home owners to get.

For private, especially for bank loans, the bank may require the owners to take a mortgage insurance from them, or if they allow, to get it from an insurer outside. This is to ensure that the loan can be repay in case anything happens.

Some older generations such as my parents, misunderstood it as "HDB housing will be free/no need to pay anymore" if one of them die. But the concept behind is the HPS that pay out to settle the loan when an owner dies/is no longer able to pay.

 

[endlssorrow]

Yup.. this I know. Normally how much for such coverage do you know?

Mortgage insurance is a type of insurance that is designed to protect your mortgage loan against the event of a life changing event in your life, like death or TPD whereby a person can no longer (work) to pay off the housing debt. Usually it is a decreasing term plan as it is cheaper, though people can choose to use a normal term plan or any other coverage in replacement.

Usually for HDB, they have got a compulsory Home Protection Scheme (HPS) which they require home owners to get.

For private, especially for bank loans, the bank may require the owners to take a mortgage insurance from them, or if they allow, to get it from an insurer outside. This is to ensure that the loan can be repay in case anything happens.

Some older generations such as my parents, misunderstood it as "HDB housing will be free/no need to pay anymore" if one of them die. But the concept behind is the HPS that pay out to settle the loan when an owner dies/is no longer able to pay.

 

[moejoseph]

Yup.. this I know. Normally how much for such coverage do you know?

It is like a term plan. Depending on age and coverage amount, not very expensive if just on death and TPD. For an age 30, at most a few hundreds to $1000+ depending on coverage amount.

For decreasing term, the coverage will decrease as year passes by, so premium will decrease accordingly as well

 

[moejoseph]

mortgage can use aviva 1 million term for private? public hdb can and i am using it to pledge that i have sufficient coverage instead of home protection scheme.

Shouldn't be an issue as long as there is coverage, but ultimately still need to check if the bank loaned from allows, as some may want to push you to buy from their tied insurer.

 

[BBCWatcher]

Usually it is a decreasing term plan as it is cheaper, though people can choose to use a normal term plan or any other coverage in replacement.

I'd like to highlight the second part of this sentence. It's best to consider life insurance needs holistically, including but not limited to housing.

In the event of your untimely passing, and if you have dependents, unrestricted cash that your survivors could use to pay off a mortgage, and for any other needs, is better than what amount to restricted funds to pay off a mortgage. It's certainly possible, even likely, that your survivors would want to adjust their housing when you're no longer around -- to move closer to relatives, closer to a workplace, or whatever. And it's easier/simpler if they have the choice to sell the home and pay off the mortgage that way (plus collect some equity), and keep cash in hand, rather than to pay off the mortgage then sell the home.

Another problem with mortgage insurance is that it effectively raises the cost of accelerating repayment of your mortgage, if that's what you want to do. As you pay off principal on an accelerated basis, you're actually doing that against a policy premium that was based on not doing that. So, effectively, you've overpaid for mortgage insurance. I don't recommend accelerating repayment on a low cost mortgage -- and mortgage rates right now are still low cost -- but in the future, if there are higher interest rates, that could be an issue.

OK, so what do you do if you want decreasing term life coverage? Well, one way you can do that is to purchase two or three separate term life insurance policies with staggered terms. For example, you could purchase:

$200K term to age 55
$200K term to age 60
$200K term to age 65

Total coverage is $600K, but it drops down to $400K then $200K as you age, and presumably as your mortgage principal decreases and your savings/wealth increase. (Also as dependents become less dependent -- children getting closer to adulthood and reaching adulthood.) And unlike mortgage insurance, term life insurance is easy to purchase and to compare directly at comparefirst.sg. No agent visit, call, "special friend," or bouncy castles -- none of that nonsense.

 

[endlssorrow]

Will it be better to get term insurance which will be cheaper right?
Like mortgage insurance premium (coverage say $800k] will be much higher than term insurance same coverage of $800k

 

[BBCWatcher]

Will it be better to get term insurance which will be cheaper right?
Like mortgage insurance premium (coverage say $800k] will be much higher than term insurance same coverage of $800k

It'll depend on the policy conditions, but it's highly likely the term life insurance will be the better deal in the situation you describe.

"Shop around," basically. If you do find affordable and reasonable mortgage insurance, you might also consider mixing mortgage insurance with term life insurance -- for example, insuring half your mortgage with mortgage insurance and then combining that with term life.

 

[iduncheckmail]

If you get term insurance as replacement to mortgage insurance , payout can be used as the benficiary decides . If mortgage ins it only can pay off bank loan. Costs are also diff.
Weigh the pros and cons then decide .

 

[Free-Spirit]

Can check roughly how much? Any recommendation to take other than this Chubb

I think we did not get any insurance. Do we really need it ?

 

[tangent314]

Mortgage insurance isn't always absolutely necessary, unless banks start requiring it for loans. It would really depend on your financial situation, and what your available options are. There is the option where the surviving spouse is able to service the loan him/herself with the help of existing life insurance. There is the option to sell the place and downgrade to cheaper dwellings. It would be harder with kids, of course, but still not impossible.

Many agents will tell you both to insure for the entire sum of the loan, although it should theoretically be sufficient for each joint owner to insure just their half (or whatever split arrangement).

 

[Free-Spirit]

Mortgage insurance isn't always absolutely necessary, unless banks start requiring it for loans. It would really depend on your financial situation, and what your available options are. There is the option where the surviving spouse is able to service the loan him/herself with the help of existing life insurance. There is the option to sell the place and downgrade to cheaper dwellings. It would be harder with kids, of course, but still not impossible.

Many agents will tell you both to insure for the entire sum of the loan, although it should theoretically be sufficient for each joint owner to insure just their half (or whatever split arrangement).

Hi

Thanks for the quick reply.
My bank did not ask for it when I took loan. Just in case someone would like to know, it's OCBC.

 

[JuniorLion]

What is the best bang-for-buck home content insurance?

 

[Zenest]

I think we did not get any insurance. Do we really need it ?

Insurance is essentially money.

If you have enough personal wealth to offset your financial liabilities, including the mortgage, then you don't need it.

If you do not have enough to offset bank mortgage and your beneficiaries cannot keep up with mortgage repayments, they may be left without a roof.
Mortgage insurance may then be useful if you like to provide for them.

For your consideration.