CUNA Mutual Group announced today that it has begun broadly rolling out its mortgage protection product to credit unions and credit union members.
The insurance firm announced this past February that it had partnered with financial technology provider D+H to integrate offering the product with D+H’s MortgagebotPOS during its pilot testing phase and said it will continue that partnership as it rolled the product out to more credit unions.
The insurer said it timed the rollout to coincide with the start of the summer home-buying season, when many consumers purchased new homes, refinanced existing mortgages and often changed residences and it cited a statistic from the U.S. Postal Service that 45 million American move from one residence to another each year.
“When we talk to families about their financial concerns, it’s clear that the ability to keep up on vital payments—like their home mortgage—is top of mind,” CUNA Mutual’s Director of Mortgage Payment Protection, Chris Arenz said. “When the unexpected happens, they want to know that they can stay in their home without draining their savings, putting their credit score at risk, or compromising their long-term financial health. Mortgage payment protection provides yet another compelling reason for people to rely on their credit union for home financing needs.”
The protection kicks in in cases of a borrower’s death, disability or involuntary unemployment, the insurer said.
Arenz said the firm viewed the product as complimentary to other insurance and not as a replacement product. For example, in the case of a borrower’s death, the product provided 12 months of mortgage payments that can give a family breathing room to make financial adjustments and keep the mortgage payments current until other life insurance companies paid their claims.
“Most term life insurance is sold on the idea of replacing an income, not drawing down existing debt,” Arenz said. “Our product helps families keep making payments until that replacement income is in place.”
He also reported that the firm had paid one claim while in the pilot phase, helping a credit union member family through a period of financial hardship due to disability.
CUNA Mutual also cited statistics from the Pew Charitable Trust and NeighborWorks America that have reported almost 60% of Americans have said they are not prepared for financial emergencies and that more than 30% have said they have no emergency savings.
“Our mortgage protection product is one example of how we’re investing in new and innovative ways to support credit unions for the future,” Arenz added. “We are able to provide additional protection for members while also helping to mitigate risk for credit unions’ lending programs.”
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