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Mortgage insurance products can be fairly straight forward. There is mortgage life insurance to guarantee that your mortgage will be paid in case of your death. This kind of insurance can be decreasing term or fixed; your type of mortgage will determine which. The other type of mortgage insurance is disability that will keep paying your monthly mortgage when you become disabled.

Once the kind of policy is decided upon, the homeowner has to decide regarding optional products.

For example, a mortgage disability policy can be one with partial disability benefits and the beneficiary is paid a certain amount during the defined period of the disability or it may be with residual benefits where the beneficiary is paid benefits in proportion to his loss of income.

You may have a choice between short term disability insurance in which the policy will cover a maximum term of, for example two years. If you have retirement funds and planned on early retirement, you may not need to have disability insurance to cover your home loan when you start that income stream.

In addition to choosing a policy, the buyer will have to choose between a choice of riders available. They are: guaranteed renewable policy, non cancelable policy, guaranteed future insurability, inflation protection or waiver of premium.

Inflation Protection

Purchasing this rider will mean that your benefit will go up as inflation rises. A rider like as this prevents your disability payment from becoming inadequate should inflation pick up.

Guaranteed Future Insurability

If the value of the home grows, whether through normal appreciation or because of improvements, the value of the protection can grow with it, without any requirement for a new application.

Guaranteed Renewable Policy

As long as premiums continue to be paid, the insurance will be renewable, although premiums may be raised to maintain the same coverage.

Non-Cancelable Policy

A policy that is non cancelable has a rider that fixes its renewability, and, as long as the premiums are paid, the premiums cannot be raised.

Waiver of Premium

When have started collecting benefits under the policy, you will not have to continue to pay the premiums, if you pick this rider. It would be a difficult financial load to have to continue to pay the premiums on the insurance after you have become disabled.