If you’re seeking a way to protect your outstanding repayment mortgage debt from the unexpected, mortgage protection life insurance could be your ideal solution. This type of term life insurance, also known as decreasing life cover, provides a safety net for your loved ones, enabling them to pay off a mortgage or other long-term loan if you pass away during the policy term.
HOW DOES MORTGAGE PROTECTION LIFE INSURANCE WORK?
As you continue to make payments on your mortgage, the outstanding amount naturally decreases. Correspondingly, your mortgage protection life insurance coverage also diminishes over time. Throughout the duration of your policy, you’ll be required to pay consistent premiums each month.
MATCHING YOUR COVER AND MORTGAGE REPAYMENTS
The cover amount, which denotes how much your loved ones might receive if they make a successful claim, gradually decreases until it reaches £0. The goal is to ensure that your life cover and mortgage repayments simultaneously reach £0. As a result, decreasing life insurance typically offers lower premiums than other life cover types.
KEY POINTS TO REMEMBER ABOUT YOUR COVER
However, remember that your cover will cease if you stop paying your premiums. Also, the cover amount can only be paid out once, and there’s no cash-in value at any point.
IS LIFE INSURANCE MANDATORY WITH A MORTGAGE?
Although not legally required when obtaining a mortgage, some mortgage providers may insist on life insurance. The suitable life insurance type for you depends on your individual circumstances. Discuss your needs with your mortgage adviser to review the appropriate life insurance to cover your mortgage.
WHY CHOOSE LIFE INSURANCE FOR YOUR MORTGAGE?
Securing a mortgage is a significant life event and an opportune moment to consider the protective measures you have in place for yourself and your loved ones.
ENSURING FUTURE SECURITY WITH MORTGAGE PROTECTION LIFE INSURANCE
Mortgage protection life insurance offers future reassurance, allowing you to enjoy your life today, knowing that your loved ones will be protected later on. If you pass away before paying off your mortgage and it’s within your life insurance policy term, the money from a successful claim could help pay off the rest of the mortgage or any other long-term loan.
Don’t forget, our professional friendly advisors are on hand to support you and can help you explore all of your options.