Can Homeowner's Insurance Be Cancelled if the Homeowner Dies?
Full Question:
Answer:
Private mortgage insurance is the private sector alternative to Federal Housing Administration (FHA) mortgage insurance, which is a government program backed by taxpayers. There are some important differences:
Private MI typically may be cancelled sooner.
Private MI is available on a wider variety of loan products
Mortgage life insurance pays off a mortgage if the homeowner dies or becomes disabled. Many of the policies include liability insurance so that if anyone is injured there you have protection. There are some types of mortgage insurance that cover the remaining mortgage should the owner die. But, if the lender does not require it due to a low down payment, one would have to specifically buy that.
The answer will likely be governed by contract law principles. We suggest you read the terms of the policies involved carefully to determine the homeowner's rights and obligations in the event of death, as well as those of the insurer.
