Life insurance is an important financial product that can protect your family if something happens to you. One of the biggest considerations when buying life insurance—and calculating how much coverage you need—is your mortgage.
Mortgage insurance is a term policy that provides declining coverage as your mortgage value declines over time. While mortgage protection insurance products were available not that long ago, they have been steadily phased out by carriers because most people don’t stay in the same home for 30 years, or they refinance at some point in time. Instead, it makes more sense to purchase term life insurance that can protect your family in your absence to include paying off the mortgage balance on your home.
To select our top picks, we researched 13 insurance companies across a series of categories that are important to borrowers, including availability, product features and benefits, and third-party ratings from reputable companies such as J.D. Power and A.M. Best.
Mortgage insurance, also known as private mortgage insurance or PMI, is a type of insurance that is required on all residential mortgages with a loan-to-value above 80%.
Mortgage insurance is not a type of homeowners insurance. Instead, it protects the lender in cases where homeowners default — it does not protect the homeowner if they start missing monthly payments on their mortgage.
Just as consumers need protection, homeowners insurance companies do as well to avoid damage being done to their assets. This is why this type of mortgage insurance exists.
Today, we’re introducing you to some of the top mortgage insurance companies that provide dwelling coverage services.
What are the top mortgage companies?
Last year, MGIC Investment Corp. was the top mortgage insurance company in the United States, with $1.32 billion in direct insurance premiums written. The Milwaukee-based insurance company claimed a healthy 24.2% of total market share and nearly doubled the volume of the second-largest mortgage insurer.
PMI Group Inc., the second largest mortgage insurer, wrote $839 million in premiums and grabbed 15.4% of the market share.
American International Group (AIG) was a close third with $816 million in insurance written, claiming 15% of market share.