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Canadian insurance company vs Canadian Bank: Is it the same Insurance product?

By Bridge Force Financial Group Inc.
Edited by Admin
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Canadian insurance company vs Canadian Bank: Is it the same Insurance product?

Buying insurance from a Canadian insurance company vs a Canadian Bank: Is it the same product?

 

The short answer to this common question is no. 

 

There are a host of differences between buying insurance from a Canadian insurance company vs a Canadian  bank, some of these differences are highlighted below:


Insurance Company

Bank (Lending Institution)

You own the policy and you name the beneficiaries.

  You are part of a group policy owned by the lender.    The lender is the beneficiary.

The benefit amount goes directly to your named beneficiaries. They decide how to use.

 The benefit amount goes directly to the lender and    they pay off mortgage.

The policy amount never changes. Your beneficiary receives benefit in the full amount of the policy.

 As your mortgage decreases the policy amount  decreases, however, the premiums remain the same.

 Your payments and benefits are guaranteed for the life  of the policy. You are the only one who can cancel the  policy.

 Your payments and benefits are not guaranteed. The  lender can change or cancel the policy at any time.

 When your mortgage is paid off, you can continue  your coverage, convert, renew or cancel.

 When your mortgage is paid off, your policy ends.

 You are in control of your policy.

 The bank if in control of your policy.


As you can see from this comparison (between buying insurance from an insurance company vs a bank), a policy bought from a Canadian Insurance Company sold by an Insurance advisor offers a more flexible, client centric product. 

 
 If you are in the market for mortgage insurance, please contact us and we can match you up with an advisor in your area.  
 
Photo image credit: Got Credit
3 comments
Level 9 (XP: 3550)
2 years ago
Are there any specific instances where buying insurance from a bank would be more beneficial? Thanks for the great article!
Level 6 (XP: 2400)
2 years ago
I'm glad I came across this information as the first thing i would normally do is go straight to the banks. This is well laid out and concise.
Level 7 (XP: 2700)
2 years ago
Buying insurance from an insurance company vs a Bank, always one of the major questions most people have, especially since Canadian banks are always the go to. This was very informative and straight forward! thank you