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The Life Insurer – Manulife Financial
The life insurance component of the Mortgage Protection Plan is underwritten by The Manufacturers Life Insurance Company (Manulife Financial).
Manulife Financial is Canada’s largest life insurer, as measured by balance sheet assets, income, shareholder equity and market capitalization. Funds under management by Manulife Financial corporation and its affiliated companies were in excess of Canadian $139.8 billion as of June 30, 2000. Established in 1887, Manulife Financials extensive network of employees, agents and distribution partners serves more then 7 million customers in 15 countries and territories.
The financial ratings assigned to Manulife Financial and its subsidiaries are consistently within the highest levels awarded by the rating agencies, recognizing Manulife Financial as one of the strongest companies in the life insurance industry worldwide.
Manulife Toll Free Number 1-866-677-4366
Who Is Eligible?
Any borrower or guarantor who is at least 18 years of age but not yet 63 is eligible to apply – up to a maximum of two per mortgage. The customer must be a resident of Canada, but needs not live in the property to which the mortgage applies. All Types of residential mortgages are eligible – firsts, seconds, private financing, etc.
Commercial mortgages are also eligible provided:
- There is a regular repayment schedule on the mortgage, whereby the principal balance is continually reducing; and
- The person applying for the insurance has some personal obligation in connection with the mortgage; i.e. the applicant must personally co-sign or guarantee the mortgage.
Death Benefit
- The Death Benefit is the amount outstanding on the mortgage, as at the date of death, plus up to 5% to cover discharge costs if, since the date of application, the customer hasn’t borrowed any additional funds, or extended his amortization period.
- In any other circumstances, the benefit will be the mortgage balance that would have been outstanding as at the date of death based on the mortgage amount, amortization period and interest rate in effect when the mortgage was first advanced (i.e. when the customer applied for the insurance), plus up to 5% to cover discharge costs.
Interest accruing between the date of death and the date of claim settlement will also be included in the benefit.
Maximum Amount Of Insurance
The largest mortgage that can be insured under the Mortgage Protection Plan is $400,000. Partial insurance is not allowed. Insurance on a mortgage greater than $400,000 represents a special risk and should be referred to our Individual Service Unit.
How Much Does It Cost?
The System will automatically calculate the appropriate premiums for you when you print the application. Provincial sales taxes apply in Ontario and Quebec.
There is a minimum premium charge of $8.00 per month (not including any applicable taxes). If you do a 1st and 2nd mortgage together, the $8.00 minimum will apply to the total transaction. Premiums are based on the initial mortgage balance and the borrower’s age at the time of application (the older borrower for joint coverage). Premiums do not increase as the customer ages.
When Coverage Starts
The customer has a choice of either:
- the date on which the insurance application is properly completed and signed; or
- the date on which the mortgage is advanced. If the health questions are all answered “no”, the mortgage amount is less than $250,000, and the first premium is paid when due, coverage will commence on the date selected. However, if an applicant has answered “yes” to any of the health questions, or if the mortgage amount is greater than $250,000, the insurer must first review the customer’s health status. In this case, coverage will take effect on the date the insurer notifies the customer that his/her application has been accepted, assuming the first premium is paid when due.
When Coverage Ends
The insurance terminates on the earliest of the following dates:
- the end of the amortization period shown on the Application for Insurance;
- the date which the Plan Administrator receives a written request from the insured to cancel the coverage;
- the day on which the insured turns 70;
- the date of the insured’s death;
- the date on which the mortgage is discharged;
- the day premium payments become 31 days in arrears;
- the date on which the Group Policy is terminated, in which case, at least 30 days’ advance written notice will be provided to all insured.
Health Evidence
If the customer answers “yes” to any of the health questions, or the mortgage balance is greater than $250,000, the insurer reserves the right to arrange for a blood profile to be carried out by a paramedical service, at a time and location specified by the customer. The cost will be paid by the insurer. In the vast majority of cases, no further medical evidence is required.
However, the insurer may request other tests or a paramedical exam.
Exclusions
No benefit will be paid if death results from:
- Pre-existing conditions causing death within the first 6 months of coverage’
- Suicide occurring within the first 2 years of coverage;
- Attempting to commit a criminal offence;
- Acts of war (terrorism, insurrection, etc.);
- Travel in or decent from an aircraft, other than as a fare-paying passenger.
Disability Insurance Product Details
Disability coverage ensures that monthly mortgage payments will be made if an insured is unable to work, for up to one full year.
Who Is Eligible?
Any borrower or guarantor who is at least 18 years of age but not yet 63, is eligible to apply — up to a maximum of two per mortgage (same criteria as for life insurance). All types of residential mortgages are eligible – firsts, seconds, private financing, etc. Just about everyone is eligible to apply, including individuals who are sometimes excluded from this type of plan. MPP covers”
- Self-employed persons (must be able to provide written evidence of income)
- Seasonal workers who have been employed at least 13 weeks in the past year (benefit period will match their normal work period);
- Stay-at-home moms.
To Qualify for Benefits
To qualify for benefits the insured person must be totally disabled for at least 60 days. This means:
- they must be under the regular care of a physician; and
- if they re working at the time, they must be unable to perform the main duties of their regular job; or
- if not working, they must be unable to carry out at least 2 essential daily life activates e.g. getting dressed or eating on their own, or getting in and out of bed.
Monthly Benefit Amount – Single Coverage
The benefit, subject to a monthly maximum of $3,500, is the lesser of:
- the actual monthly mortgage repayment obligation plus the insurance premium payable;
- the “Monthly Payment” as shown on the Insurance Application. The benefit may include monthly property taxes if these are disbursed by the lender. the total benefit payable is also limited to the actual amount of income the insured lost due to their disability during the same period. 100% of Monthly Benefit Amount this amount is paid for single coverage and 50% is paid with respect to each person insured in the case of joint coverage.
Monthly Benefit Amount – Joint Coverage
If joint coverage is purchased, 50% of the Monthly Benefit Amount (described immediately above) is paid when only one of the two borrowers is disabled.
Benefit Period
Benefits start to be payable after the 60 day Qualification Period (see above) is satisfied, and they will continue for as long as the insured remains disabled. The benefit is always paid monthly, regardless of the actual mortgage payment frequency, beginning on the first mortgage payment due date that follows the Qualification Period. There is a maximum of 12 monthly payment per illness or injury.
Special Bonus Payment:
Typically, entitlement to disability benefits STOPS as soon as the claimant is no longer disabled. However, MPP has been to provide extra help to the insured while in transition back to full-time work.
How?
As long as the maximum of 12 payments has not already been disbursed, a bonus payment of one full monthly benefit will be made on the next regularly scheduled payment date after the insured has returned to work. If Total Disability recurs within 30 days following the end of a Benefit
Period, it will be deemed as a continuation of the earlier claim.
Exclusions
No benefit will be paid if disability results from:
- A pre-existing condition which gives rise to a claim during the first 12 months of coverage; (“pre-existing condition” means a health condition or symptom that was diagnosed or treated within the 12-month period just prior to the date on which the borrower applied for insurance)
- Normal pregnancy or childbirth, abortion or miscarriage (subsequent complications related to a pregnancy may be covered);
- Cosmetic or elective surgery
- Committing or attempting to commit or provoke a criminal offences
- Operation of a motor vehicle while under the influence of alcohol or drug use, other than as prescribed by a physician.
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