What is mortgage reducing term assurance or insurance?  
Mortgage reducing term assurance or insurance is a form of decreasing term insurance whereby the sum assured of the policy decreases in accordance with the loan outstanding. House purchasers usually assign this type of policy to the banks as collateral securities for their housing loans. The policyowner usually pay a single premium for such a policy and the amount is dependent on the principal loan amount, the term of repayment, and the mortgage loan interest rate. At the end of the repayment term, the amount of cover decreases to nil, just as the loan outstanding does the same. Like all term policies, there are no benefits payable at the end of the policy term.

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