Comparing BMO Mortgage, Life, and Disability Insurance Vs. Individual BMO Insurance Policies

Posted on December 12, 2010 and updated April 12, 2018 in BMO Life Insurance, Canadian Life Insurance Companies, Insurance Types, Life Insurance Canada News, Mortgage Insurance 2 min read

Bank of Montreal offers a mortgage, life, and disability insurance policy, which is available through the insured’s mortgage lender. The insured has the option of choosing mortgage life insurance or mortgage, life, and disability insurance coverage. Mortgage disability insurance cannot be purchased on its own.

The premiums on the mortgage, life, and disability insurance policy are added to the insured’s monthly mortgage payment. Individual life insurance policies purchased through BMO Insurance provide tax-free proceeds, which can be used to pay off a mortgage, other debts or to replace lost income in the event of death.

Individual disability coverage is not available through BMO Insurance, but most brokers should be able to offer solutions in this area from another carrier. Individual BMO Insurance Term policies which are among the most competitive in the Industry are also convertible to a Permanent plan without a medical.

Other banks including RBC Insurance,  CIBC and TD also offer creditor life and disability policies.  Some of additional benefits of Individual Insurance is that the coverage is portable, the insured chooses their beneficiary, coverage is level and many carriers offer a return of premium or cash value option. 

For more information on mortgage life insurance, please contact us at 1-866-899-4849 or visit our Mortgage Life Insurance Quote Page.

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thomas
thomas

I’m a diabetic and got denied disabilty insurance with sunlife. I’m 26, What options do I have?

LSM Insurance
LSM Insurance

Thanks Thomas. It depends the reason for the decline. We offer Simplified Issue disability insurance with Humania Assurance and The Edge that may be a good fit. I will send you a separate email now.

Sayhay
Sayhay

How does BMO’s Term 30 plan stack up against RBC

LSM Insurance
LSM Insurance

Thanks for the note. RBC does not offer a Term 30 plan. BMO’s rates are competitive but it depends on youdate of birth, smoking status and face amount.

Silvia
Silvia

What is the biggest difference other than the price and can I switch without any penalties

LSM Insurance
LSM Insurance

Thanks for the note. There are several differences but in my mind the biggest is the coverage on an Individual plan is level and does not decline with your mortgage and you can customize the insurance amount to your appropriate need. There should not be a fee for cancelling your mortgage insurance, check with the bank to verify and VERY IMPORTANT make sure your new coverage is approved and inforce before cancelling any existing coverage.

J. Edwards
J. Edwards

Mortgage Insurance through the bank is a rip-off.

terrrence
terrrence

Thank you for the explanation. But by now I would think most consumers know the pitfalls of bank owned mortgage insurance policies

LSM Insurance
LSM Insurance

Terrence you would be surprised the number of people who buy mortgage insurance policies from a lending institution. There is still a lot of misguided people, the timing is often an issue – many people are thinking about their mortgage rather than mortgage insurance when they sign up for their coverage.

J Toms
J Toms

How much is $200,000 Term 10 and Term 20. I’m 62 want to cover my mortgage.

LSM Insurance
LSM Insurance

Thanks for the note. The premiums will depend on your age nearest age, smoking status and health. We will send you a separate email now.

Kasper W
Kasper W

How do BMO’s plans stake up against Canada Life. I’m a computer programmer looking to replave $5000 a month if I get disabled

LSM Insurance
LSM Insurance

BMO does not offer individual disability insurance in Canada. BMO’s Life and Critcial Illness products are well priced but it depends on your needs and the plan you are looking for. We will send you a separate email now.

George
George

How much is $25,000 of Guaranteed Life Plus? I’m 64 smoker – have diabetes

LSM Insurance
LSM Insurance

Hi George, The BMO guaranteed Life Plus is sold direct by BMO. If your only health issue is diabetes you would likely qualify for a traditional life insurance policy or a Simplified Issue life insurance policy. This would allow you to get more coverage at a lower premium and coverage from day one.

Lewis J
Lewis J

Do you sell a combination disability insurance / life insurance policy. Im a 41 year capeneter and make about $… year

LSM Insurance
LSM Insurance

Thanks for the note. BMO Insurance does not sell individual disability insurance. But we do work with carriers who sell both life and disability insurance and will be in touch by email. Thanks,

Unser
Unser

Insurance through the bank is a rip off. If you don’t belive me check out the CBC market place report.

LSM Insurance
LSM Insurance

I think the report you are referring to is https://lsminsurance.ca/mortgage-life-insurance/cbc-marketplace-in-denial

I think rip off may be a strong word – I agree most people can better deal on life insurance than through a lending institution. Having said that some smokers get a better deal with mortgage insurance through the bank since they use blended pricing. If someone does take mortgage insurance through bank or any insurance for that matter read the application over carefully to make sure health information is accurate.

LSM Insurance
LSM Insurance

Hi Gina, You will be able to qualify for some type of plan. But the reason for the decline will determine the type of plan. Traditional/Regular Life Insurance – is the most difficult to qualify for but the most comprehensive coverage. If you a serious health issue you may qualify for a No Medical Plan. Simplified Issue plans have no medical tests and s short series of health questions. Guaranteed Issue plans have no medical tests and no health questions but the face amounts are more limited and the benefit is limited in the first 2 years if you die… Read more »

LSM Insurance
LSM Insurance

Can I get coverage through you I was declined at the bank.

LSM Insurance
LSM Insurance

James thanks for sharing your thoughts.

James
James

As a broker for over 20 years I can tell you straight up that direct carrier policies are not a good deal. The premiums are not as good and how are you suppose which plan is best and how much coverage you need. There simply is not the same due diligence.

LSM Insurance
LSM Insurance

Tanya most indicdual plans definetly give you a better deal.

The one exception is for older smoker – many bank sold mortgage insurance plans use blended rates so smokers are often paying a lower rate than they should.

Another important note make sure you are approved for any new coverage before cancelling your existing plan.

Tonya
Tonya

My husband have mortgage insurance with TD Bank this seems like a bit of a ripoff – do all the plans offered by the banks work this way?

Elizabeth
Elizabeth

It is not my first time to visit this website, i am browsing this
site daily and obtain facts from here every day.

Tim
Tim

Rates, being unprecedentedly low, develop reduced earnings of just about all Canadian insurance company.
Many insurers are preventing these loss by blowing up the associated with their permanent life insurance
policies. BMO Insurance, Industrial Alliance, Canada Life,
Manulife, and Empire Everyday living have just about increased the fees about the fixed-cost popular life insurance policy.

Manulife has attended the challenging and agreed to withdraw may of coverage from
a unique permanent array. It is expected that other major insurers will
likely decide to do the precise same in my foreseeable lasting.

LSM Insurance
LSM Insurance

Thanks for the note Peter. An individual life or disability policy with BMO or another carrier is not linked specifically to your mortgage. The proceeds are paid out tax free (assuming premiums are paid with after tax dollars) and can be used to pay off a mortgage, line of credit, replace lost income or however your benenficary wants.

Peter
Peter

I have a BMO mortgage with disability insurance. I read on your report that “individual life insurance policies…. provide tax-free procedds, which can be used to pay-off mortgages”. Can you elaborate on this statement? with an example?
Thank you