3.- WHO SHOULD BE THE BENEFICIARY OF LIFE INSURANCE?
When life insurance policies are made by a bank, it usually puts itself as a beneficiary. That is, you die and the insurance company pays compensation to the bank instead of your family. With this the outstanding capital of the mortgage is settled.
Depending on which community you live in and what inheritance taxes you are required to pay, it may be advantageous for your bank to receive the amount to pay the mortgage.
But wouldn't it be better if you insured your life for an amount greater than the money you owe on the mortgage so that yours could face other expenses and get ahead if you are missing?
When you are paying a mortgage you never know exactly what you owe, the interest, the outstanding capital and a lot of concepts make you mess up and never be clear. That is why you should not leave exclusively in the hands of your bank things that only they understand.
It is logical that the bank charges, but your family too. Paying the mortgage is usually not enough when a family member dies. It is necessary to expand the coverage.
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