When you refinance your home, your current mortgage protection policy only sometimes flows to the new loan. Since mortgage life insurance is linked to the original mortgage obtained, the term and coverage is based on the original mortgage amount. The terms of your mortgage, including loan amount, interest rate, or loan duration, changes once you refinance and this impacts mortgage protection policy because of difference in term, loan amount and interest rate.

You have few choices to keep coverage following refinancing. You can first contact your mortgage life insurance company to see whether your present policy will fit the new mortgage. If not, you might have to get a new mortgage life insurance policy with revised loan terms and amount.

On the other hand, one could want to get a conventional level life insurance policy instead of a mortgage-specific one. Since the payout of a regular term life policy can be used for any kind of financial need, not only mortgage payback, it offers more freedom. Particularly if your goals or financial situation have changed since you first obtained the mortgage life insurance, this could be a more flexible choice.

Original Source:- https://www.quora.com/What-happens-to-my-mortgage-life-insurance-if-I-refinance-my-home/answer/Ranjit-Singh-3890/log