Special Markets Solutions Introduction to Group Mortgage Insurance - - PowerPoint PPT Presentation

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Special Markets Solutions Introduction to Group Mortgage Insurance

Presented by: <Name>

A PARTNER YOU CAN TRUST. Innovative Insurance by Industrial Alliance

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What is creditor insurance?

• Group Mortgage Loan Insurance.
• Specifically designed to protect the borrower’s ability to repay their

mortgage.

• Life, critical illness and disability insurance are all offered.
• Each coverage can be purchased separately or in various combinations.
• Insurance benefit is equal to the insured decreasing mortgage balance for

life and critical illness or the insured monthly mortgage payment for disability.

• Group Mortgage Insurance is for fixed or variable residential mortgage

loans.

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Coverage details

• DECREASING TERM LIFE INSURANCE - in the event of the insured’s premature

death, the outstanding insured mortgage balance will be paid to the mortgage

• lender. Min/Max: $20,000 up to $1 million.
• DECREASING CRITICAL ILLNESS INSURANCE - In the event the insured suffers
• ne of the six (6) covered critical illnesses, the outstanding insured mortgage

balance will be paid to the mortgage lender. Covered critical illnesses are: Heart Attack, Stroke, Cancer, Paralysis, Major Organ Transplant, and Coronary Artery Bypass Surgery. Min/Max: $20,000 up to $1 million.

• DISABILITY INSURANCE - In the event the insured becomes Totally Disabled, the

insured monthly mortgage amount will be paid to the lender for up to a 12-month period per disability. Min/Max: $300 up to $3,500 per month.

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Coverage details

• Applicants must be aged between 18 and 64 years of age to apply.
• Must be a resident of Canada.
• Mortgage loan must be with a Canadian lender.
• Due to the nature of repayment, HELOC mortgage loans are not eligible

to be insured under this product.

• Applicants must be named in the mortgage loan agreement, or can be a

guarantor of the loan.

• Premiums are collected monthly via Pre-Authorized Debit payment.

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Why is mortgage protection necessary?

• Financially protects your client (and their family) from losing their home or

suffering a financial crisis.

• Most people are underinsured, and Group Mortgage Insurance can be

used to “top-up” existing insurance coverage.

• Fully protecting your mortgage will allow other insurance policies to be

used for equally important financial needs (e.g.: child education).

• Disability Insurance can ensure the mortgage loan remains in good

standing thereby protecting your client’s credit rating.

• Critical Illnesses are unfortunately very common and can affect your

client’s ability to meet their financial obligations.

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Why mortgage brokers should offer mortgage protection.

• Provides an important product to your client, while adding value to your

service.

• Strengthens your relationship with your client.
• Provides an additional revenue stream to your mortgage brokerage

business.

• Underwriting requirements are generally less stringent than traditional life

insurance applications.

• Premiums are age-issued, and remain fixed for the term of the insurance.
• Mortgage Brokers can offer creditor insurance to their clients without

holding a Life Insurance License (specific licenses required by Mortgage Brokers in AB & SK from respective provincial Insurance Councils).

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Financial incentive

> Mortgage brokers can supplement their monthly income with expense

allowance (EA).

> Expense allowance is paid to Mortgage Franchises. Franchises pay their

mortgage brokers.

> Unlike our competitors, we pay expense allowance for the lifetime of the

certificate to the Group Master Policyholder (i.e.: Franchise).

> Expense allowance is paid after Industrial Alliance receives the first

premium payment.

> Chargebacks are no longer applied when the client cancels and a refund

is due.

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What is the Application Process?

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Print an insurance quote and/or application form from Filogix-Expert or

• ther loan origination system.

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Present the insurance quote to your client in conjunction with the mortgage offer. Creditor insurance must be offered at the time the mortgage financing is being arranged.

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Encourage your client to complete the simple application which includes authority to perform telephone underwriting.

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Email or fax the signed application form to Special Markets Solutions at:

• Email: solutions-creditor@inalco.com, or
• Fax:

1-888-553-5433

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Our team will process the application, and arrange further underwriting directly with your client. We will email the status of the application to the mortgage broker.

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Application Tips

• The application package provides full details on the insurance to the
• customer. However if your client has any questions, please refer them to:
• Our dedicated website - www.solutionsinsurance.com/mortgage,
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• Our Creditor Administration Team at telephone: 1-800-923-5626 or

email: solutions-creditor@inalco.com.

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Two types of applications

• Guaranteed acceptance applications – If an applicant answers “no” to

the 6 health questions on the application, and they fall within specific coverage maximums, the application will be approved. Applications are processed within 3 business days.

• Underwritten applications – If your client answers “yes” to any of the 6

health questions and/or the insured benefit is over $350,000, your client may need to undergo further underwriting which may include:

• A telephone interview;
• Further medical tests, such as urine and blood; or
• Information from their doctor.

Applications are processed within 14 to 30 days.

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Confidence in the product

• Industrial Alliance does not conduct post-claims underwriting. All our

applications are underwritten (either by the 6 qualifying health questions

• n the application, or full medical underwriting). They are referred to as

Guaranteed Acceptance, and Underwritten applications.

• Some competitors offer Guaranteed Issue mortgage loan insurance, (not

to be confused with Guaranteed Acceptance) where there are no health questions asked at time of purchase, and your client’s insurance can be subject to post-claims underwriting.

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How to offer the coverage

• Include an insurance quote with every mortgage offer, stressing the

importance of covering their debt.

• Always offer insurance – whether its a new mortgage or a mortgage renewal.
• Have your client to consider the following:
• Do they have life, critical illness or disability insurance? Is their existing

insurance coverage enough to pay-off the mortgage loan?

• Consider partial coverage of the loan to meet a client’s budget.
• Could they continue to make the mortgage payments if they were disabled or

ill? Could they recover their credit rating if they were not able to make the mortgage payments?

• No obligation 30 day money back guarantee – if within the first 30 days of the

active coverage, your client decides they do not need the insurance, they can cancel and any paid premiums will be refunded.

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How to offer the coverage (continued)

• If your client requires more information regarding the insurance, please

direct them to our website: www.solutionsinsurance.com/mortgage

• Require all clients who refuse Insurance to sign the waiver that clearly

states they were offered but have refused the coverage. Clients can also tick the waived boxes on the application form to confirm their refusal of coverage.

• Remember - you are not expected to be an Insurance expert. You are

simply offering your client an essential product at the time they are arranging their mortgage loan. Our team will assist in all client questions.

• Please contact our administration team if you have any questions

regarding our insurance – 1-800-923-5626.

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Any Questions?

• For more information please refer to the Broker Training Manual to

provide more details.

• Further training available on:
• D+H Expert
• Application completion