Mortgage Redemption Insurance

What Does Mortgage Redemption Insurance Mean?

Mortgage redemption insurance is a type of decreasing-term life insurance designed to help policyholders pay off their mortgages if they pass away before the loan is fully paid. This ensures that the financial burden of the mortgage does not fall on the surviving family members.

Insuranceopedia Explains Mortgage Redemption Insurance

Mortgage redemption insurance is a form of life insurance that can assist beneficiaries if the policyholder passes away. Given that mortgages are often valued in the hundreds of thousands or even millions of dollars, the sudden death of the primary breadwinner can place the surviving family members in a challenging financial situation.

The amount the insurance will pay varies, but in many cases, it can cover the entire remaining balance of the mortgage.