Widows of the Fallen in Fight with Banks over Mortgages
- Thread starter niner domestic
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I would not take this as a trend that they will change their ways. I am of the opinion that this is a Public Relations Ploy that will help them save face at the present, but in the long run, now that the Clause has been brought into the Public limelight, they will begin to enforce it in the future. I am sure there will be no removal of the 'War Clause' from Policies. Now it will revert to "Buyer Beware". You now know it exists. If you buy it, then you are subject to it.
The "War Clause" in policies, is a point I have made with many in the past. Be aware of it and act accordingly. The Insurance Companies are in the business of making money, not handing it out. In the future, they will not capitalize of favourable publicity, but hold you to the terms of the contract you signed.
EDUCATE yourself of what the ramifications are to the "War Clause" in an Insurance Policy, and what it entails. It does not necessarily have to be a "War", but could be any form of 'violence' in a Region with an 'unstable political situation'. It could be a 'Terrorist event' like a bombing in downtown TO. The "War Clause" is open to a very broad interpretation.
The "War Clause" in policies, is a point I have made with many in the past. Be aware of it and act accordingly. The Insurance Companies are in the business of making money, not handing it out. In the future, they will not capitalize of favourable publicity, but hold you to the terms of the contract you signed.
EDUCATE yourself of what the ramifications are to the "War Clause" in an Insurance Policy, and what it entails. It does not necessarily have to be a "War", but could be any form of 'violence' in a Region with an 'unstable political situation'. It could be a 'Terrorist event' like a bombing in downtown TO. The "War Clause" is open to a very broad interpretation.
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There are lending institutions that do not have a "War Clause, declared or undeclared." The bank holding my mortgage is one of them.
As many have said, SISIP is cheaper and there are few problems in collecting it, however, as has also been mentioned, $400K does not often leave a great deal for the family once the house is paid off.
Many SISIP reps are trying to push to bring it more in-line with modern costs of living, but it is a slow process. It has to be self-supporting.
As many have said, SISIP is cheaper and there are few problems in collecting it, however, as has also been mentioned, $400K does not often leave a great deal for the family once the house is paid off.
Many SISIP reps are trying to push to bring it more in-line with modern costs of living, but it is a slow process. It has to be self-supporting.
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Another little clause one should be on the look out for is the manner in which insurance companies are paying out claims. There has been a recent trend for them to only pay out in an annuity (monthly installments instead of a lump sum). In those cases, if there were such a death claim, the insurance would continue to pay the monthly mortgage payment which on the surface is fabulous *until* the surviving partner either goes to sell the home and discovers the insurance is only on *that* particular home and that particular mortgage or attempts to re-finance the home/mortgage and discovers that they will require a new policy in their name. So, take the time and read the fineprint on your policies and pay attention to the how's, when's and what's.
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I was told once by a financial adviser that If I had SISIP max it out if I didn't GET IT! The coverage is basically foolproof, the premiums are low and the pay out is fast. All the banks, mortgage companies and the like are in the business of making money and they don't want to give you any if they don't have to. Loan insurance is a money grab pure and simple. I especially like the look on their faces when I say no thanks I got it covered.
My .02
NTF. The adviser was not affilated with SISIP or the CF and she sold life insurance to boot!
My .02
NTF. The adviser was not affilated with SISIP or the CF and she sold life insurance to boot!
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Well, to be fair, it sounds like the banks smartened up right quick. Shared with the usual disclaimer....
Flaherty tells banks to be 'generous' to war widows on mortgage insurance
Canadian Press, 12 Feb 07
http://www.recorder.ca/cp/National/070212/n0212135A.html
OTTAWA (CP) - Finance Minister Jim Flaherty says he's going to bat for the widows of Canadian soldiers caught up in a mortgage-insurance fight with financial institutions.
Several widows of soldiers killed in Afghanistan say they were told by their banks or insurance companies that the mortgage insurance they've spent years paying into does not apply because their spouses died in combat.
Liberal MP Judy Sgro raised the matter in the House of Commons on Monday, asking what the government is doing to help the women.
"These individuals all deserve the highest respect and care from their government and all Canadians," Sgro said.
"When will they offer the widows and the families of our fallen soldiers automatic relief against future mortgage payments?"
Flaherty responded that he was "shocked" to hear about the situation and said he has already taken action.
"I made it clear to the banks today that I expect them to be generous in their treatment of all widows in this country. I await their response and I will be pleased to report to the House with respect to their response as soon as it is received."
Maureen Gillam, whose husband, Sgt. Craig Gillam, was killed last October in a rocket attack near Kandahar, said she received a letter days ago stating she could not benefit from her mortgage insurance because of a so-called act-of-war clause.
However, hours after a reporter questioned Manulife Financial about the issue, the institution reversed its position and determined it would pay off the mortgage.
Manulife spokesman Tom Nunn said the bank is not changing its overall policy, but could review special cases like Gillam's to determine if the exclusion should be waived.
For others, too, the process has been mired in mixed messages and stress.
Kendra Mellish, whose husband, Warrant Officer Frank Mellish, died last September in a firefight in Afghanistan, said she was initially told she would likely not be able to collect on her mortgage insurance because of a war exclusion clause.
She pursued the issue with officials at the Bank of Montreal, who issued the policy near her home at New Brunswick's Canadian Forces Base Gagetown, and was told they'd look into it.
While awaiting an answer, Mellish was forced to continue paying her mortgage. Four months later, she said the bank revealed it had no such exclusion clause and would begin payments.
A spokesman for the Bank of Montreal said he didn't believe the bank has ever had an act-of-war clause and said the confusion could have resulted from a misunderstanding at the local branch.
The issue became so aggravating for widowed spouses that Brig.-Gen. David Fraser, the Canadian who commanded NATO forces in southern Afghanistan for nine months last year, met with senior bank officials to sort out the matter.
Fraser, who didn't want to identify which banks he approached, became aware of the problem after women whose husbands were killed on his watch in Afghanistan raised it when he visited them at military bases after his deployment.
In another case, Cpl. Kelly Dove said she was initially told by Scotiabank that her mortgage would not be paid after her husband, Warrant Officer Rick Nolan, died last September.
But after Christmas, the bank informed her the mortgage would be covered.
Scotiabank spokesman Joe Konecny said Monday there should never have been any question that the bank would honour the policy.
"We do not have an act-of-war clause and never have," Konecny said in an interview from Toronto. "There may have been some confusion at the branch level and the wrong message was provided and we apologize for any confusion or inconvenience."
Flaherty tells banks to be 'generous' to war widows on mortgage insurance
Canadian Press, 12 Feb 07
http://www.recorder.ca/cp/National/070212/n0212135A.html
OTTAWA (CP) - Finance Minister Jim Flaherty says he's going to bat for the widows of Canadian soldiers caught up in a mortgage-insurance fight with financial institutions.
Several widows of soldiers killed in Afghanistan say they were told by their banks or insurance companies that the mortgage insurance they've spent years paying into does not apply because their spouses died in combat.
Liberal MP Judy Sgro raised the matter in the House of Commons on Monday, asking what the government is doing to help the women.
"These individuals all deserve the highest respect and care from their government and all Canadians," Sgro said.
"When will they offer the widows and the families of our fallen soldiers automatic relief against future mortgage payments?"
Flaherty responded that he was "shocked" to hear about the situation and said he has already taken action.
"I made it clear to the banks today that I expect them to be generous in their treatment of all widows in this country. I await their response and I will be pleased to report to the House with respect to their response as soon as it is received."
Maureen Gillam, whose husband, Sgt. Craig Gillam, was killed last October in a rocket attack near Kandahar, said she received a letter days ago stating she could not benefit from her mortgage insurance because of a so-called act-of-war clause.
However, hours after a reporter questioned Manulife Financial about the issue, the institution reversed its position and determined it would pay off the mortgage.
Manulife spokesman Tom Nunn said the bank is not changing its overall policy, but could review special cases like Gillam's to determine if the exclusion should be waived.
For others, too, the process has been mired in mixed messages and stress.
Kendra Mellish, whose husband, Warrant Officer Frank Mellish, died last September in a firefight in Afghanistan, said she was initially told she would likely not be able to collect on her mortgage insurance because of a war exclusion clause.
She pursued the issue with officials at the Bank of Montreal, who issued the policy near her home at New Brunswick's Canadian Forces Base Gagetown, and was told they'd look into it.
While awaiting an answer, Mellish was forced to continue paying her mortgage. Four months later, she said the bank revealed it had no such exclusion clause and would begin payments.
A spokesman for the Bank of Montreal said he didn't believe the bank has ever had an act-of-war clause and said the confusion could have resulted from a misunderstanding at the local branch.
The issue became so aggravating for widowed spouses that Brig.-Gen. David Fraser, the Canadian who commanded NATO forces in southern Afghanistan for nine months last year, met with senior bank officials to sort out the matter.
Fraser, who didn't want to identify which banks he approached, became aware of the problem after women whose husbands were killed on his watch in Afghanistan raised it when he visited them at military bases after his deployment.
In another case, Cpl. Kelly Dove said she was initially told by Scotiabank that her mortgage would not be paid after her husband, Warrant Officer Rick Nolan, died last September.
But after Christmas, the bank informed her the mortgage would be covered.
Scotiabank spokesman Joe Konecny said Monday there should never have been any question that the bank would honour the policy.
"We do not have an act-of-war clause and never have," Konecny said in an interview from Toronto. "There may have been some confusion at the branch level and the wrong message was provided and we apologize for any confusion or inconvenience."
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That would be a hard thing for these widows to go through, especially the ones that have small children. Definately tough times for them, not only emotionally with loosing thier husbands, but also trying to figure out on thier own how to make ends meet without becoming homeless. My heart goes out to them.
Rebecca
Rebecca
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I heard today on the radio that the benefits are being paid
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Yes, it would be too much.............then what, police, fire, corrections? Where does that line stop?
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not that i completely disagree with you, but in a major conflict where do we draw the line? Right now that would work, hell the system is pretty much set up, the funds would just have to be allocated. Lets say we go to a full out conflict where more Canadians die. I am not saying that their sacrifice wouldn't be appreciated but everyone (including the member) is aware of their responsibilities before leaving for a tour. Taking the extra time to ask "the right" questions can save this heartache. I believe the article is more about "the knowledge is power" stand point. Insurance companies deny every claim. That is how they make money....
I do like where you are going though Ben
I do like where you are going though Ben
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Not to be morbid or disrespectful; your idea may currently look good, but what will you opinion be if there were thousands of widows annually instead of 44 over a couple of years?
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Navy_Blue said:Would it be to much to ask Canadian tax payers to pick up widows tabs??
For the people who have the privilege of staying home and leading a normal life in this country I think its the least they could do.
Yes, that is asking far too much of tax payers, who also work very hard for their money and have every right to expect that members of its armed forces make informed decisions about their chosen career paths and the risks associated therein, including the risk of dying and leaving your spouse with an unpaid mortgage. Should the cost of such risk be spread amongst various policy holders of mortgage insurance, perhaps but not likely. A more equitable solution would be for the government to pay the premiums of a capped insurance policy designed specifically for such risk, provided that the members also contribute to the fund and that any such members contribution is fully refundable upon termination of service, and perhaps even tax deductible without fear of clawback after termination of service.
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I think it comes down to the fact that many people don't even know that war clauses exist. Look at the two banks that didn't even have one but the local branches thought they did. Everyone involved is becoming more educated about this issue.
It is a standard clause that exists in many insurance policies that makes sense from a business point-of-view, it also makes sense for us and our families to use businesses/products that do not have such a clause.
Wook
It is a standard clause that exists in many insurance policies that makes sense from a business point-of-view, it also makes sense for us and our families to use businesses/products that do not have such a clause.
Wook
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As someone who makes his living in the insurance industry these days (although not on the life insurance side of the business), I can second that pretty strongly. The "extra-contractual" payments are a PR effort, period. Many of the exclusions and conditions you see in any insurance policy are driven by re-insurers (companies that insure insurance companies, to put it simply), and they don't give a rat's hindquarters about public opinion, since the public isn't their client, the insurance company is.
I'd add that there are as many policy wordings out there as Campbell's has soups. Allow me to reinforce what's been said a few times already: read yours in detail before buying, especially the exclusions, and ask for written clarification of any terms that are unclear or ambiguous. If you can point to a paper trail that says you fully disclosed your circumstances and they sold you a deficient policy in full knowledge it wouldn't pay out, you'll have a decent case against them in court.
I'm of the opinion that SISIP's capabilities should be expanded upon to meet this need. $400K is a ridiculously low maximum payout: if you're a MCpl at the top of your pay scale with a $100K mortgage and two kids you'd eventually like to send to college or university, you should probably be carrying close to $600K in life insurance. That you can't through SISIP is absolutely astounding to me.
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Babbling Brooks said:
Wise words, from someone in "the know".
Thanks, Babbling Brooks - your perspective is appreciated.
Roy
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GAP, I only brought up the example to show that if you've been in longer than 30 seconds, you've probably outgrown SISIP's capacity. Which doesn't mean you shouldn't use it, just that it should be expanded so CF members can actually cover themselves properly with it.
Yeah, a $100K mortgage was lowballing, I know...
Yeah, a $100K mortgage was lowballing, I know...
Navy_Blue said:Would it be to much to ask Canadian tax payers to pick up widows tabs??
For the people who have the privilege of staying home and leading a normal life in this country I think its the least they could do.
I think taxpayers do already contribute to the financial well being of the families of the fallen. $250,000 through VAC (if death is service related), supplementary death benefits-(a government subsidized life insurance program), continuing survivors benefits and pension income/health care, education benefits for children of veterans, counselling services.
I agree that SISIP should increase their maximum payout. This would allow military personnel to customize their life insurance based on their own unique circumstances- if they need more coverage (more kids, bigger house) they could opt for that and pay for it accordingly.
When they are calculating how much coverage is required, however, should they not take the abovementioned benefits into account?
Am I overlapping some of the benefits?- They are all separate, right? None of them are clawed back somehow so that they don't reach the families? ie. SISIP life insurance is separate from VAC award/services is separate from SDBs-all of these benefits reach the families-none cancel the others out?
If this is the case (I'm asking) and if the bigger picture (of all the payouts and benefits) is brought into focus, does the financial well-being of families seem as bleak as it has been made out to be in this story?
I'm really glad that this topic came up because it will make people pay attention to what is available and what is not- what they should be aware of and who they should get their coverage from. It also seems that the insurance companies themselves had better be doing the in-service thing for their employees- get them straightened out as well- so that they can better advise their clients.
There seems to be a lot of confusion on the subject...and I hope I haven't added to it by saying something totally out in left field. I've never been a financial wizard so you'd be certainly helping me out by correcting me if I'm wrong- I could get my own affairs into proper order.
Hope I've been clear...
Bren
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