Widows of the Fallen in Fight with Banks over Mortgages

[niner domestic]

The widows of the fallen have been experiencing delays with their mortgage holding banks in paying out the death benefits from their mortgage insurance.  The insurance companies have been denying their claims based on the war exclusion clause. Article found here:

  http://ca.news.yahoo.com/s/capress/military_widows_woes

This is a good time to remind everyone who is either in theatre or heading to theatre to check their paperwork on these issues. 

 

[armyvern]

Well,

Perhaps the government should begin a Royal Commission and have an inquiry into this "insurance fraud" being perpetrated by those Companies raking in the record setting billion dollar profits along side the banks.

After all how can one legally be denied their insurance payout when Canada and it's soldiers are not officially at "war." Seems the double-edged sword is once again being weilded to shaft policy holders, our fallen, and their families. Disgusting.

 

[vonGarvin]

If a police constable falls in the line of duty, is she covered?

Also, I believe that the bottomfeeders insurance agencies have "declared or not" in their clauses wrt wars.

 

[Matt_Fisher]

Does SISIP not have mortgage coverage as part of their benefits?

 

[Mapper]

We had that clause in our mortgage insurance and we were both in at the time.  It makes for a nice money-grab by both the bank and the insurance company as both benefit from the interest of those drawn out insurance payments over the lifetime of the mortgage.  Not to mention the billions in yearly profits...someone's hands are in my pockets..

 

[McG]

Does SISIP not have mortgage coverage as part of their benefits?

Nope.  There have been other threads that have gone into the problems associated with SISIP max coverage being less than what one could get from other companies (but those other companies have that "no war" thing).

Is it time for SISP to get with the times and offer the 2x, 3x, 4x life model or even better go up to $1 000 000, which is not unheard of? After all with people living into their 80s it isn't all that much once amortised.

 

[George Wallace]

I have had several Banks and Financial Institutions call and offer insurance.  I declined all, but found it amusing to ask the caller what their "War Clause" was.  Most don't know anything about what they are selling and know nothing of the "War Clause", so it is not unusual to hear that many are getting caught in this "scam".

 

[aesop081]

Just goes to show READ BEFORE YOU SIGN !!!

 

[riggermade]

It is not only the loss of life insurance, alot of banks offer insurance if one cannot work and they will cover your payments...we got caught in that scam  when I was in...my wife was told by a doctor she had to quit work while pregnant, which should have been covered by the payments we were making but because I was in and working the bank would not honor the insurance, needless to say we did not take that insurance when we bought our second house....military members have to go into all the fine print before paying out the bucks

 

[Shamrock]

"Act of War" in an insurance policy is a very flakey thing.  Peacekeeping/peacemaking duties are included in the clause, as well as domestic acts of terror.  This varies from policy to policy -- my mortgage insurance has no act of war clause and I ensured I was given that in writing above and beyond my insurance policy (from the bank manager).  Naturally, my policy predates September 11, 2001 and the bank has since re-instated its policy.

Some policies will simply state it will not cover death or disability resulting from act of war, and it's important that be explained in detail to the signee, preferably in writing, especially if said person is a soldier and deploying.  He or she may not be covered while deployed, but the insurance could try to weasel its way out of a claim resulting while on leave or during a non-combat deployment (such as DART).

 

[riggermade]

There is alot of things to go into when signing any type of policy...in my case it was at the Credit Union on the base in Edmonton...they knew full well I was in the military and when it came time to pay out their excuse was because I was employed the policy was void although that was not was explained at time of signing

 

[Roy Harding]

Does SISIP not have mortgage coverage as part of their benefits?

Notwithstanding (nice insurance type lead-in, don't you think?) MCG's comments above, I have used SISIP as mortgage insurance in the past.  I simply named the mortgage holder as the beneficiary, up to whatever the mortgage was worth, and my wife as the beneficiary for the remainder.  It's not "mortgage insurance" per se - but it worked.

 

[charlesm]

I have used SISP for a number of years because it is cheaper than mortgage insurance. Also after a few years I have paid down some of the mortgage but the rate from the bank won't drop until you renew your mortgage.

During our DAG TF 1-08 the lady explaining SISP warned us all about the "War Clause" in insurance contracts.

SISP is a good rate but you can only max out at $400K, which considering paying off a mortgage and having enough for 6 boys and the wife is cutting it pretty fine.

 

[Armymedic]

Better yet, do not get mortgage insurance if you have SISIP. I declined insurance at the bank, and just had to show that I held sufficient life insurance thru SISIP to cover my mortgage to the bank before approval....

Mortgage insurance is not mandatory.

More money in YOUR pocket.

 

[a78jumper]

I am not surprised . When my brother in law died in late 2003 of leukemia while in Reg Force service, my sister went to their Bank (the one with the comfy green leather chairs) to make arrangements for the mortgage insurance to be paid out, and was told "So sorry", chronic leukemia was an existing medical condition, bye bye. While it was true M  had the disease a total of five times from 1990 until his passing there was a period of more than five years in the mid/late 1990s where he had a clean bill of health and thus applied for and was accepted for the insurance on his mortage when it was renewed in 2000, after truthfully answering the medical questionnaire (he did not qualify fof the insurance at the time the mortgage was first taken out in 1993, having just recovered from the second bout with this awful disease)  Then XY Bank had no problemo with collecting the premiums for more than three years. But try to collect $97K from these skinflints after his death? All this from an institution that made billions in profit the same year.
Fortunately my sister is no pushover and was not about to play the role of grieving helpless widow. She told the Bank Manager he had ten minutes to reconsider the Bank's position on the whole matter, and her next stop would be her lawyer's office next door to initiate a lawsuit for the money and punitive damages. She got the $$$$.

 

[a78jumper]

Better yet, do not get mortgage insurance if you have SISIP. I declined insurance at the bank, and just had to show that I held sufficient life insurance thru SISIP to cover my mortgage to the bank before approval....

Mortgage insurance is not mandatory.

More money in YOUR pocket.

My experience as well. I never have insured a mortgage or loan, and in fact still carry the SISIP insurance I had while in into retirement. Right now costs about $28 and change a month.

Being adequately insured against all perils one might face in the course of a military career is one of the things that should be drilled into all service members from Day One. My aforementioned sister collected more than $1.6 million when M died. It can not bring him back, and he sure is missed, but on the other hand my sister and their three children live quite comfortably because of actions both she and M took prior to his passing.

 

[GUNS]

Mortgage insurance is a total ripoff. There are other means available that will cover your mortgage. I have been with my present life insurance company for more than 25 years and their adviser suggested I take out a life insurance policy to cover the value of the mortgage. It was cheaper and regardless how much was left on the mortgage if something happened to me, my wife got the full value of the life insurance policy. When I told my insurance company that I was rejoining the military, they said it would not affect the policy.

It maybe worth your while to check it out, life insurance instead of mortgage insurance.

 

[George Wallace]

Banks and Insurance Companies are in competition with each other.  Both are after your money, and both will offer you insurance that overlaps what the other offers.  If you have Life Insurance that covers your Mortgage, why get Mortgage Insurance from your Bank, and vis versa?  In the end the two may get together and then average out what you do receive should a "mishap" happen.  Instead of getting the $1 million from your Insurance Co. and another $1 million from your Bank, they will average them out to $1/2 million each.

In the end you are paying fees needlessly to institutions who will try everything in the books not to pay out any monies.

 

[geo]

When I bought my house I was single.  When the Bank asked me if I wanted Insurance... I told em, no thanks - you can sell the house in the event I die.  Now that the mortgage is almost paid off, my wife is still a little irritated over that remark but, she is happy the mortgage is almost done.

 

[GAP]

Just announced on CFRA that Manulife is reversing it's policy in this instance and will pay out on the policy. Not sure if this applies to all the policies or just this one.