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Bread Winner

Your Comments – Replies #2

I have  this comment from a Miss Cecilia Yong who asked on this blog post,

“Question on mortgage reducing insurance: what is the relationship between bread winner (person serving the property loan) and the dependant? Must is be parent-child relationship? What about husband-wife relationship? Can this suffice?”

First and foremost, thank you for visiting and reading my blog and definitely for this valuable comment! And I will try to answer this to the best of my knowledge (my answer is rather personal and there can be some legal element to this, so for better clarification, you may have to consult a lawyer and such)

Let’s first break down the question into different definitions:

1. Bread-winner: this is the general term used to describe someone who is providing the main financial income to the family. Should anything happen to this particular person, there could be some drastic financial crisis unless plans have been made beforehand.

2. Dependents: I have done up a few searches and most sites give the definition as those who depends on the so-called bread-winner for a financial income. So people who can be called dependents could be a) your parents b) possibly your grandparents c) your children d) your siblings (if in some situation, they do depend on you).

3. Mortgage Reducing Insurance: As mentioned in my post, there’s an existence of a mortgage loan between two parties – owners of a property and a Financial Institution who provides this loan. And do note in the case of a mortgage loan, it may not just be the Bread-winner being the main owner of the loan, and one can always add the names of their spouse, parents or siblings to be in the mortgage loan agreement.

Should anything happen to any of the parties as mentioned above, the remaining parties will still continue to bear the remaining loan repayment term.

And to apply for the Mortgage Reducing Term Insurance, the presence of the loan agreement must be there and this also mean that those name(s) listed in the loan agreement are allowed to get covered with the Insurance. Terms and conditions do apply (e.g. home-makers have a maximum limit in insurance coverage and may not be allowed to get covered in full – matching the actual loan)

So What Happened When There’s A Claim?

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