Can I purchase mortgage insurance on a bank mortgage in-case of a natural disaster?
April 16, 2010 by
Filed under mortgage insurance
I live in a townhome that is being financed. Can I purchase insurance to cover my mortgage balance incase my home were to catch fire. My homeowners assoc. covers the outside structure of the house, but do I need special insurance to payoff the balance of my loan in the event of a tragedy.
If your townhouse complex is not covered by a blanket policy, then yes you would need to have insurance to cover in case of destruction. If the complex HOA has a blanket policy, then no you don’t really need the additional insurance, other than to cover your personal belongs. If you wanted insurance to pay off the mortgage should you die, that is separate as well.
Make sure you have all the info on the coverage by the HOA as they are at times under-insured. You should get a copy of the policy from the HOA and have your insurance agent review it as well.
Speaking of which, make sure you have enough coverage (you do have your own insurance….don’t you?) on the contents and structural parts of the town home that you’re responsible for. You HOA documents will have this information.
As far as insurance in the event of your death (to have your mortgage paid off), most mortgage companies and even companies like New York Life offer policies for this purpose.