With any type of insurance your goal is to reduce your risk. There is essentially a bet against the odds. If you don't get the insurance, can you beat the odds and not have a situation in which you need protection. If you do get the insurance, is the protection that you pay for worth the money you put into each month. Certainly, there is no difference when considering mortgage unemployment insurance.
Because it is a relatively new type of insurance, you may be quickly ready to dismiss mortgage unemployment insurance as simply another big pit to throw your money into. However, you may want to consider this type of insurance protection with today's economic environment making its way into every state and every workplace.
What Is the Risk of Not Having Mortgage Unemployment Insurance
The risk of unemployment today is higher than at any time in recent history. Unemployment rates in the United States have skyrocketed over the last year and specifically over the last few months. Projections have the current conditions worsening in the coming year. These are the risks that employed workers like you face.
While you may have had a secure job a few months ago and may have one at this moment, things are changing quickly. This is not to scare you, only to warn you that forethought and preparation can make the difficult times much more bearable.
What Do You Get with Mortgage Unemployment Coverage
Mortgage unemployment insurance will pay your monthly mortgage for a period of time that depends upon the length of your unemployment or the length of time that was agreed upon when you signed up for the insurance. Generally, the policies will pay your mortgage anywhere from three to six months, though it may be possible (and more expensive) to purchase a policy that will pay out for a longer period than the six months.
What Do You Pay For Mortgage Unemployment Protection
You pay for mortgage unemployment insurance in order to protect your home against a period of unemployment. It is up to you as to the amount of coverage you want to purchase. You could pay as low as $15 a month for a couple hundred dollars of protection, or you could pay around $75 for $1,500 dollars worth of coverage. These are estimates, of course, as different companies will have different rates.
What is the Risk of Purchasing a Mortgage Unemployment Plan
Each year you will have the option of canceling the mortgage unemployment insurance or renewing for another year. The most you will be risking over the entire year by purchasing a mortgage unemployment insurance policy is generally less than one payment to your monthly mortgage.
Mortgage unemployment policies will generally not kick in until you are at least 30 days into your unemployment and six months into your premiums. However, if you lose your job during the first six months of your insurance policy, many companies will reimburse you the premiums already paid, though they will not pay on your claim.
It is up to you to determine if mortgage unemployment insurance is a safe bet for you. An examination of your current employment, financial stability, and future outlook all come into consideration as to whether or not you should purchase mortgage unemployment insurance.
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