The most profitable offer depends on the disposal schedule (Photo: ShutterStock)
Mortgage life insurance is insurance that accompanies us for many years, usually between 15 and 30 years.
The insurance is required by law in Israel and is intended to guarantee the mortgage payments to the bank in the event of the death of one or two of the insured.
Usually, the bank that approved a mortgage also offers to purchase life insurance.
Alternatively, you can ask the insurance companies for a quote and choose the most affordable option.
Oded Gil Raz, insurance agent, life insurance expert and owner of the insurance agency Oded Gil Raz - Insurance Agency Ltd., says that the most profitable offer depends on the settlement schedule. That is, it is not only important how much the insured pays today but how much he will pay until the end of the insurance. And it is an amount that varies from company to company.
"Mortgage life insurance is insurance that is constantly decreasing in terms of the amount of coverage," Raz says.
"We know for sure how much the mortgage will cost in one year, five years, ten years, and we adjust the insurance to these amounts. If the insurance starts with an amount of one million, after five years it is 900 thousand and so on. What is important to look at in mortgage life insurance is the premium that the customer pays For the entire period and how profitable it is."
How significant are the differences between life and mortgage insurance?
"The differences are very big. Today, mortgages have creative routes that agents usually don't use, such as a free 13th extension, or a free 15th extension. If the mortgage is short-term, then there are also massive discounts for the first six years or significant discounts for the entire period. We check every customer Individually, in all companies and in all routes. Even the insurance companies do not customize the policy, they offer a policy with a standard settlement schedule and send you on your way."
"My best advice to the client is to examine the progression of the settlement schedule. I check the balance of payments throughout the insurance period, with an Excel table, and do what is most profitable for that client. The differences in the premium amounts are significant. This is not a trick. This is mortgage insurance that is tailored Personally according to the customer's needs and not according to a template."
What is the difference between an insurance agent and an insurance company or the bank's mortgage insurance?
"My main advantage as an insurance agent is the ability to find the cheapest offer for the client throughout the years. It depends on many parameters such as age, health status and more, but you can always find a better one. I come across very few cases where agents and insurance companies match mortgage insurance personally . Most agents do a normal disposal schedule with a normal policy and at most offer the client two months free. My huge advantage over others is that I can offer more profitable policies."
Why don't insurance companies offer these benefits in mortgage life insurance?
"Because they harm their profitability. But as far as I'm concerned, first and foremost is the customer's benefit. In this way, I earn the customer and his loyalty, and this is better than the fact that every two years the customer will move to another place. Most customers do not know that there are, for example, a variety of free years, or discounts In the first years. They call and get the insurance and think that if they pay NIS 80 today instead of NIS 90, that's fine. But if they don't pay NIS 13 at all, it's better for them to pay NIS 90 now. My customers know this, but the other customers don't."
According to Raz, if a customer indicates to the insurance company that he knows about the benefit, it is likely that they will give it to him.
"But", he says, "even between the different routes of the companies, there is a difference. This means that sometimes company A offers a better offer than company B. When a customer calls the insurance company, he does not get a comparison with the other companies. The unequivocal advantage of an agent is that he can check and compare benefits and discounts for him in three or four different companies and match the best offer."
How much can you save when you take out customized mortgage insurance?
"I have a client who took out mortgage insurance through the bank with some company. His settlement schedule amounted to NIS 37,000 for 30 years on a NIS 1 million mortgage insurance. After I checked alternatives for him with other companies, we lowered the amount to NIS 22,000 for the entire period He is still insured for the amount of the mortgage for the entire period. That is, the coverage started at 1 million, dropped to 950,000 after two years, to 800,000 after four years, and so on. And the customer received a savings of 15,000 shekels throughout the entire mortgage period with the same insurance coverage Just like a case of death closes a mortgage."
Why is this information not exposed to the borrowers?
"The insurance companies don't want this information to appear because they have no interest, of course, but they did give these routes to the insurance agents. These are routes with a fairly aggressive impact on the agent's commission, but I do this to attract clients to me. When the client realizes that I see his benefit in the mortgage, he He knew that as his insurance agent I would do my best for him in other matters as well."
For more information and to get in touch, you can contact by phone
- 072-3200717
the page of Oded Gil Raz Insurance Agency on the legal website
The information presented in the article does not constitute legal advice or a substitute for it and does not constitute a recommendation to take procedures or avoid procedures.
Anyone relying on the information in the article does so at their own risk
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