Oklahoma Life Producer Practice Exam

Decreasing term insurance is considered the most suitable option for mortgage protection primarily because it is both affordable and aligned with the declining balance of a mortgage. As mortgage balances decrease over time, the coverage provided by decreasing term insurance also reduces accordingly. This structured benefit ensures that the amount of insurance matches the financial obligation associated with the outstanding mortgage, making it a cost-effective choice for homeowners who want to protect their families in the event of untimely death.

Furthermore, decreasing term insurance usually has lower premiums compared to whole life, universal life, or variable life policies. This makes it easier for homeowners to maintain coverage throughout the life of the mortgage without straining their finances. In essence, it offers a tailored solution to meet the specific needs of mortgage holders, ensuring that the policy's value directly correlates with the debt that needs to be paid off upon the policyholder's passing.