For a city that is renowned for its sprawling mountains with top-notch hiking trails and ski resorts, beaches lined with volleyball nets and basketball courts, a modern downtown core and one of the largest ports in North America, if there is one area where Vancouver is known for really punching above its weight class it is in the housing market.
Specifically, the cost of homes. Vancouver (with a population of just over 2.6 million) currently ranks 3rd behind only Sydney, Australia (with a population of just over 5 million) and Hong Kong, China (with a population just shy of 7.5 million) as being one of the least affordable places to own a home in the entire world.
While the purchase price of a large property with a detached house in Vancouver used to be $200,000.00 to $300,000.00, that amount would not even cover a down payment on a similar property in 2022.
With increased purchase prices come increased mortgage sizes. It is not uncommon to see property owners take on mortgages of $400,000.00 to $600,000.00, if not substantially higher, which in turn leads to high monthly mortgage payments.
While no one likes having to make large monthly mortgage payments, that seems to be the reality if you want to own a property in Vancouver in 2022, a goal which is increasingly seeming further out of reach for more and more people. But what happens if you take the plunge to purchase property in the Vancouver market and cannot make your monthly mortgage payments due to a disability related to injury or illness, or due to the death of a partner?
What is Mortgage Protection Insurance?
Mortgage protection insurance is insurance put in place to respond if the policyholder is unable to make their mortgage payments due to serious injury or illness, or due to a death. These policies will make payments towards the mortgage they are registered to, either monthly payment installments or a lump sum payment to pay off the outstanding balance of the mortgage.
For most people, without the benefit of mortgage protection insurance, they would be unable to make their monthly mortgage payments if they were rendered unable to work due to illness or injury, or if the income earner of the household were to pass away.
The last thing anyone wants is to have to worry about losing the roof over their head when dealing with a critical illness or injury or after having lost a partner unexpectedly. Mortgage protection insurance gives people peace of mind knowing that if disaster strikes, they won’t have to worry about their outstanding mortgage balance.
They might not always pay
Regrettably, just because you have mortgage protection insurance in place, does not mean the insurance company will always pay.
“Insurance companies will often deny legitimate claims in the hopes that the insured will just accept their decision and walk away suffering the loss,” according to Kevin Blair, a lawyer at the Vancouver law firm Taylor & Blair LLP. “The denials for this type of insurance occur for the same reason many long-term disability benefit claims or life insurance benefits claims are denied. These are most often due to the cause of the claim being a pre-existing issue or a misrepresentation in filling out the application.”
With mortgage insurance protection sometimes the denial isn’t made because of anything the applicant did, but because the mortgage insurance protection was set up by the mortgage broker as an afterthought to getting someone to sign up for a mortgage. If that broker does not pay attention to detail in the application and because of this your mortgage protection insurance is denied, you could have a cause of action against them.
If you believe your mortgage protection insurance claim was denied wrongly you should contact an insurance denial lawyer as there are strict timelines in which you have to sue.