During the first year or so of life in a new home, homeowners--especially first time buyers--are often deluged with "mortgage life insurance" offers and advertisements asking them to sign up for a mortgage protection plan. Often, homeowners open these offers and read them over to find that a mortgage life insurance policy can pay your mortgage bills, allowing your family to keep the home and continue living there in the event of your death.

Homeowners may wonder if there are differences between these offers for mortgage protection and the life insurance policies issued by standard term life insurance providers.

Mortgage Protection and Life Insurance: A Comparison

Most of the time, it's best to ignore unsolicited offers. You may be legitimately concerned about how your family will manage if you die, and if so, it may be a good time to investigate term life insurance policies--if you haven't done so already. A life insurance policy can provide a broad financial safety net for your loved ones, while a mortgage protection plan will only help them remain in your home.

When reviewing mortgage protection plans and life insurance plans, keep the following in mind:

• Medical exams: Some mailings may advertise that no medical exams are required to qualify for a mortgage life insurance policy. This can seem appealing, but a young healthy person should actually seek out insurance plans that require medical exams, as a clean bill of health can result in lower premiums. Additionally, there are some life insurance plans available that don't require medical exams.
• Value of the plan: Financially, life insurance policies offer more value over time, since mortgage life insurance premiums will stay the same even as you pay off principal and the value of your mortgage drops.

Remember that companies try to gain business through unsolicited mailings designed to profit on the fears and vulnerabilities of new homeowners. However, if you're convinced that mortgage life insurance is right for you, compare several quotes and understand the terms and coverage provided by the policy before making a commitment.