Len Lane sits down with Bart Paterson, Business Development Manager at Manulife, to explore the often-overlooked importance of life and disability insurance in the mortgage process. While many clients are familiar with default and title insurance that protect the lender and the property, Len and Bart emphasize that life and disability insurance protect the client by insuring their health, income, and long-term investment. 

Bart explains Manulife’s Mortgage Protection Plan (MPP), a flexible, portable insurance solution with fixed premiums that can provide peace of mind for homeowners facing unexpected life events, especially new homeowners. He shares sobering statistics, such as the fact that one in two Canadians will be diagnosed with cancer, and the average disability lasts around 10 months—yet most people only have enough savings to cover one month. 

Len and Bart also discuss the dangers of relying solely on employer-provided insurance, which often only covers a portion of income and may not be portable. They stress the need to have insurance conversations early in the mortgage process and address common objections like cost, helping clients understand that peace of mind and protection from financial hardship are well worth the investment. Whether you’re a mortgage broker or a homeowner, this episode highlights why protecting your mortgage with the right insurance is an essential part of smart financial planning.

About Bart Paterson

Bart Paterson is the Business Development Manager at Manulife for Mortgage Protection in Alberta and Saskatchewan. He brings experience from previous roles at Manulife Bank of Canada.

—

Contact Len Lane | Brokers for Life: 

• BrokersForLife.ca
• LinkedIn: Len Lane
• LinkedIn: Brokers for Life
• Facebook: Brokers for Life
• X: @Brokers4Life
  

Contact Bart Paterson | Manulife: 

• Facebook: Bart Paterson – Mortgage Architects
• LinkedIn: Bart Paterson
  

—

Transcript
Len  00:02

Welcome. My name is Len Lane, and I am the founder and president of Brokers for Life Inc., and we are Dominion Lending Centers in Western Canada. The topic of our podcast will be about what we consider to be Real Life Mortgage Solutions. Welcome back. We’re actually in season three of Real Life Mortgage Solutions, and today we’re going to talk about some of the things that nobody ever wants to talk about. You’ve heard about all the other insurances, Your mortgage default insurance, which is protecting the bank from you, your home and the insurance, of course, then there’s title insurance. But today we’re going to talk about probably what I consider to be the most important, the one that actually protects your investment, and that’s life and disability insurance. Over the years of being in this industry, we have gone back and forth. We have been with a couple of other insuring companies, but in the end, we always end up back with MPP, so mortgage protection plan, owned and operated by Manulife. And my guest today is Bart Paterson, Business Development Manager, Manulife Mortgage Protection Alberta and Saskatchewan. Welcome to the show.

Bart  01:10

Thank you very much. Len. I appreciate it. This is a great opportunity. 

Len  01:15

So, talk about MPP mortgage protection plan. What is it and how does it differ from other insurances that the client would come across.

Bart  01:23

It’s a great opening question, because I think when brokers do meet with clients, they’re coming to the broker for advice, and when they choose a broker, they have trust in that broker and ensure that the broker will look out for their best interests and provide them the product that fits their family and their needs right. And quite often, I think with brokers, it’s important to get the right product for the client, first off, but also mitigate the risk of these clients taking on this new debt. And you mentioned that there’s different types of insurance. And when you when we mention the word insurance, yeah, there’s default insurance, there’s home and auto, there’s title insurance. But what MPP is really, it stands for mortgage protection plan, and it is protection of your mortgage debt that you’re taking on. And so I think it’s really important for clients to know what insurance is protecting what. And to your point earlier, default insurance is generally for clients that have 20% less or 20% down or less, and it protects the client or protects the banks. MPP insurance for life and disability, it protects the client’s debt that they’re taking on. So that’s really the big difference, and this is optional. But also looking at when you’re having those conversations with the clients, it’s good intention to find out, hey, what type of insurance do you have, right? 

Len  03:05

So, what are some of the stats to consider about why you need life insurance and disability insurance?

Bart  03:11

Well, we’re starting to see more and more. Like with cancer, ine in two Canadians will come down with some sort of cancer in their lifetime, which is alarming. And we also know that for disability, the average number of months people are off work is approximately 10 months. And so we know that the average savings that people have across Canada in their bank account right now is around $3,800 so how long will that actually last? Over 10 months if you’re unable to provide an income, right, because you’re off on disability? In fact, 56% of clients that do go on disability, they go back to work early, even though they may not be healthy because of financial reasons. And we also know that 33% of Canadians will go on mental health disability at one time as well. And where we see actual claims with Manulife within the first two years, we see 44% of those clients making claims.

Len 04:22

Really? 

Bart 04:23

Yeah.

Len  04:24

That’s a huge number, right? I didn’t realize it was that high. And it’s funny to say, if you say $3,800 in savings today’s age and the amount of mortgages that people carry and stuff that that’s one month, that’s not anywhere near 10, right? 

Bart  04:38

Yeah, and so it’s we also hear I have insurance through my employer, right? That’s the other one, another one that we say, okay, but do you really know what that looks like? And so you have to dig a little bit deeper. And then what happens if you change employers.

Len  04:57

Exactly, and that’s one of the biggest ones. I’m sure that a lot of young, first time home buyers, and they all say that. But a very good example of one of my clients who was skidooing on the Athabasca River in Fort McMurray, hit a sand dune under the snow and flipped a snowmobile, probably at about way over what he should have been doing, but probably 60 or 70 miles an hour, right? Big machines these days, 26-27 years old, licensed body man, broke a hip. Yeah. So you’re you spend your whole day bent over as a body man, righ…