For most people, buying a house is one of the biggest commitments they will ever make. It is an investment, and often a home for one’s family. But what happens if you should die or become critically ill before the mortgage has been repaid in full?
It is currently not compulsory to have mortgage life insurance in place for your mortgage, but we would advise you to usually have a decreasing term life insurance – the policy runs concurrently with the mortgage, and ends when the mortgage has been paid. The sum that is paid out if you die and will decrease in line with the amount still owing on the mortgage, paying off whatever is remaining.
When taking out mortgage life insurance, many people opt to take out critical illness cover alongside it. This will pay out similarly if you become critically ill – which would be a stressful time for anybody and their family; removing the “how will I pay the mortgage while I’m ill?” factor from the equation will at least remove some of that stress. The criteria for what is covered by critical illness will vary from insurer to insurer, but most will cover strokes, certain forms of cancer, and serious heart or lung disorders. Some may also cover dementia.
Most insurance providers will offer some kind of deal for taking out both together, often making premiums cheaper than having two separate policies. Further discounts may also be found if a joint policy is taken out for spouses or partners.
Please don’t hesitate to contact us with any questions that you may have about your mortgage insurance needs – our expert advisers will provide you advice ensuring you get the right insurance for you at the best possible price.