What is mortgage protection insurance?

If you’re buying a home, there’s a lot to think about. As you begin making choices from finding the best mortgage rates to choosing your colour scheme, it's good to know you also have choices when it comes to protecting your mortgage and your family's finances from the unexpected.

While you know you’ll need insurance, it’s important to understand the different types of coverage and the different kinds of policies.

Homeowner's insurance is not the same as mortgage insurance

  • Homeowner's insurance, also known as property or home insurance, helps protect your home from physical threats like fire, water damage, accidents, and loss of property from theft. It’s required when you have a mortgage.
  • Mortgage protection insurance helps cover your mortgage payments if you become seriously ill or die unexpectedly. It’s a smart way to secure your future.

Types of mortgage protection insurance:

Choosing both term life insurance and critical illness insurance together gives you and your family the right protection when you need it most.

Critical illness insurance

  • If you become seriously ill, you’ll receive a lump-sum payment to spend as you choose, on things like medical expenses and mortgage payments so you can focus on recovery.

Learn more about critical illness insurance

Term life insurance

  • Gives you affordable, flexible protection that your loved ones could use to pay off your mortgage or cover other expenses if you die unexpectedly.

Learn more about term life insurance


The difference between mortgage insurance policies

Most mortgage lenders will give you the option to apply for mortgage insurance directly through them. But before you finalize your mortgage, think about how different their policies are from ours.

Mortgage insurance through a mortgage lender

Only the individual(s) listed on the mortgage

Term life insurance and critical illness insurance from Sun Life Financial

You, your partner and your children – you can protect your whole family, even those who are not responsible for paying your mortgage

Mortgage insurance through a mortgage lender

Only the balance of your mortgage

Term life insurance and critical illness insurance from Sun Life Financial

Whatever you need it to cover. In addition to your mortgage, it can cover debts like your line of credit, credit cards, etc.

Mortgage insurance through a mortgage lender

The mortgage lender is automatically the beneficiary

Term life insurance and critical illness insurance from Sun Life Financial

You decide who gets the insurance benefit and how it's used – to pay your mortgage, medical expenses or your child's education – whatever is best for you and your family

Mortgage insurance through a mortgage lender

The coverage amount decreases as the mortgage balance decreases. When the mortgage is paid off, the coverage ends

Term life insurance and critical illness insurance from Sun Life Financial

The amount of coverage you have stays the same for as long as you own your policy – unless you decide to change it

Mortgage insurance through a mortgage lender

You may lose the coverage and might need to reapply

Term life insurance and critical illness insurance from Sun Life Financial

Your coverage stays the same – unless you decide to change it. Since your coverage is not tied to your mortgage, you can carry it with you if you move again

Mortgage insurance through a mortgage lender

You lose all the money you paid for the coverage

Term life insurance and critical illness insurance from Sun Life Financial

Depending on the terms of your insurance policy, you may get some of the money back that you've paid in premiums*

*Depends on the type of critical illness insurance you have and does not apply to term life insurance.

Mortgage insurance through a mortgage lender

You can't

Term life insurance and critical illness insurance from Sun Life Financial

You may have the flexibility to adjust the type and amount of your insurance, or even convert to a permanent solution


Do you really need mortgage protection insurance?

A mortgage is a long-term obligation to pay back the money you’ve borrowed – and a lot of things can happen over the years. Whether you're single, married or living common law, and whether you’re with or without children, it's important to protect yourself and the ones you love.

Are you buying a bigger home for your growing family?

How term life insurance helps

  • Term life insurance can help you protect your family's finances.
  • Your beneficiary can use the coverage to pay the balance of your mortgage, or put it towards your children’s education.
  • Some term life insurance plans give you the option to cover your children, too, protecting their future insurability.

How critical illness insurance helps

  • Critical illness insurance is available for you, your spouse and your children.
  • If one of you becomes seriously ill, the insurance benefit could help replace any lost wages when you take time off work to recover or to help your spouse or child get better.
  • The insurance benefit comes directly to you so you'll be able to use it for other expenses and not just your mortgage payments.

How, together, both types of insurance help

Building a plan that that includes both term life insurance and critical illness insurance means your family has the best possible protection against the significant impact of unexpected illness or death.

Are you buying a home with someone else?

How term life insurance helps

  • If you're buying a house with someone else, you'll need to think about how you'd carry the expense of a mortgage without your partner's income.
  • Term life insurance can provide affordable protection for both of you, and help you maintain your home and lifestyle in case of an unexpected loss.

How critical illness insurance helps

  • If you and your partner both buy critical illness insurance, you'll have money available to take time off work to care for each other if one of you becomes seriously ill.
  • Having the insurance benefit can help you focus on getting better – instead of on your mortgage payments.

How, together, both types of insurance help

  • Building a plan that that includes both term life insurance and critical illness insurance means you and your partner have the best possible protection against the significant impact of unexpected illness or death.

Are you buying a home on your own?

How term life insurance helps

  • Even without a spouse or dependants, you'll leave behind debts and final expenses when you die. Term life insurance means you can make sure looking after your affairs will not be a financial burden to others.
  • By getting term insurance now, you also help ensure that you'll be protected in the future.

How critical illness insurance helps

  • If you're single and you become seriously ill, would you be able to continue paying your bills or your mortgage if your income was disrupted?
  • Critical illness insurance can help you pay for expenses like getting the care you need –  or your mortgage payments – so you can focus on getting better.

How, together, both types of insurance help

Building a plan that includes both term life insurance and critical illness insurance means you retain financial independence with the best possible protection against the significant impact of unexpected illness. And, your finances will not burden others if you die unexpectedly.

Get mortgage protection insurance

Step 1: Find an advisor

Choosing the right mortgage protection is easy with help from an advisor. Talk to your advisor or find an advisor to help answer your questions. There is no cost to talk to an advisor.

Step 2: Meet with your advisor

To get the most out of the meeting with your advisor, take some time beforehand to think carefully about what you want to achieve. And because your advisor will need additional information to help recommend the policy that’s right for you, get together some basic information about your income, assets and liabilities.

Step 3: Apply for coverage

Your advisor will handle the paperwork for you. You’ll need to submit an application for a policy that will be evaluated by the insurance company. Depending on your age and the type and amount of coverage you want, you will need to answer a medical questionnaire. You may also be asked to provide additional medical information.