Mortgage life insurance
Getting a new mortgage or a re-mortgage can be extremely exciting and very stressful at the same time.
Protecting your mortgage with a life insurance policy is a wise choice and can give you peace of mind that your family is covered, should something happen to you. There are many questions to answer and lots to consider.
If you need expert advice then you can contact iam|INSURED on 0800 009 6559 or CLICK HERE.
What is mortgage life insurance?
Life insurance for a mortgage is also known as ‘Decreasing Term’ life insurance. It pays out a lump sum that will clear your remaining mortgage balance if you die.
This means that your home will be left to your family with no outstanding debt to pay or any mortgage payments to make. Decreasing term life insurance is designed to reduce at roughly the same rate as your capital and repayment mortgage.
A mortgage life insurance policy is exactly the same as a family life insurance policy apart from a two key points:
- The amount of money that is paid out will reduce over the term of the policy
- Monthly premiums for mortgage life insurance are generally lower than family life insurance
Another important point to remember is that a mortgage life insurance is not specifically tied to your mortgage. You can take out life insurance with any insurer to protect any mortgage and mortgage lender.
Do you need life insurance for a mortgage?
One of the most common and most important questions is, do you really need life insurance to get a mortgage.
There’s a common misconception that life insurance is compulsory when you take out a new mortgage. In fact, you don’t actually need to have life insurance, even though it is heavily recommended to protect your mortgage.
You should also consider that your home may be repossessed if you fail to keep up your mortgage payments. This is also true if the main earner in the home passes away and your family cannot afford to continue making payments.
For more information about this question you can visit our Guide: DO YOU NEED LIFE INSURANCE TO GET A MORTGAGE?
Mortgage life insurance statistics UK
According to recent surveys, only just over half (58%) of homeowners in the UK has life cover in place to protect their home.
This leaves over 40% of homes unprotected with no life insurance in place at all. Some of the top reasons given for not taking life insurance to protect their property were:
- “I don’t think that I need it”
- “Life insurance is too expensive”
- “I’ve got a medical condition so cover is unavailable or too expensive”
- “It doesn’t pay out”
- “I just don’t want to think about it”
The reality is that life cover is actually far cheaper than people think and over 98% of life insurance claims are paid.
How do I get a mortgage life insurance quote?
We have made getting a mortgage life insurance quote super easy and quicker than ever before. You can get your very own MORTGAGE LIFE INSURANCE QUOTE ONLINE from our TOP insurance partners in minutes.
Follow the SUPER SIMPLE steps:
- Your age and job – what’s your date of birth (younger people pay less for life insurance) and is your job dangerous
- Mortgage cover and term – how much is your mortgage balance and how many years are left to run
- Partners information – is your application for you and your partner, and if so then what are your partners details
- Health and lifestyle – do you have any medical conditions to disclose and is there anything lifestyle based (e.g. smoking, drinking, and activities)
You can get an INSTANT mortgage life insurance quote in MINUTES
Our life insurance partners include:
- Beagle Street
- Canada Life
- Royal London
You can get a mortgage life insurance quote in minutes to protect your family and we promise to keep our online rates low.
Can I have mortgage life insurance?
Some people are put off applying for life insurance because they do not understand it or think that they can have it.
The 2 main criteria for getting mortgage life insurance cover are:
- Are you over the age of 18
- Are you a UK resident
As long as you live in the UK with a UK bank account and you are over the age of 18 years then you can apply for a life insurance policy.
Why should I take out mortgage life insurance with iam|INSURED?
We’re extremely proud to be the UK’s #1 rated mortgage life insurance EXPERTS thanks to our AMAZING customer rating of 5.0 out of 5.0 Stars on Feefo.
You can easily contact one of our SUPER FRIENDLY specialists and get the BEST cover to protect your home. We are constantly reviewing our insurance partners to make sure that we give you the lowest monthly premiums.
- Price Match Promise
- FREE expert advice
- No obligation
- FREE policy Trust service
- 100% customer rating
Getting mortgage life insurance with iam|INSURED is quick and easy, and we also have over 20 years expertise in helping people with:
What happens to life insurance when the mortgage is paid?
Great question… the answer is that either the life insurance will simply come to an end OR you can cancel your cover if you clear your mortgage early.
There are a few things to consider here such as:
- Have you come to the end of your mortgage and paid it off?
- Have you re-mortgaged your home?
- Is your life insurance term tied to your mortgage?
If your mortgage has simply come to an end and the life insurance is the same as your mortgage, then your policy will simply come to an end as well. Most people will have taken out life cover to protect their mortgage at the time the mortgage started and for roughly the same period.
If you are re-mortgaging your property then you should definitely review your mortgage cover life insurance policy. Your policy will generally protect a specific mortgage so if you change your mortgage amount or term then this policy may not fit properly.
Often people forget about life insurance when they re-mortgage their home or think that they already have cover so do not need to do anything.
Mortgage life insurance calculator
You can now compare mortgage life insurance rates QUICKLY and EASILY with our ONLINE QUOTE tool.
We help you to calculate how much mortgage life insurance will be for you based on some very simple steps.
Difference between life insurance and mortgage life insurance
The difference between family life insurance (Level Term) and mortgage life insurance (Decreasing Term) is actually quite simple.
A mortgage life insurance policy covers the remaining balance on your mortgage and will pay out a lump sum if you die. The policy is specifically to protect a mortgage and will clear your mortgage so that your home is left to your family debt-free.
You can take out a mortgage life insurance policy on a single or joint basis and you can choose the amount of cover you need.
- Decreasing Term Insurance pays out a tax free lump sum to your family if you die during the policy term, specifically to pay off your remaining mortgage balance. The amount of cover decreases over time at roughly the same rate as your (repayment) mortgage balance.
- Level Term Insurance will also pay out a tax free lump sum to your family if you during the term of the policy, to protect your family. The amount of cover will remain the same throughout the term and so your family would always receive the same pay out.
If you have a mortgage, it is strongly recommended to take out life insurance to protect it because this is generally our biggest debt.
Can you get a mortgage without life insurance UK?
It is not compulsory to take out life insurance with a mortgage in the UK and therefore it is your choice whether or not to protect your mortgage.
Some mortgage lenders may strongly recommend life insurance when you take out a new mortgage. It is also possible that your mortgage lender may require you to have some cover in place in certain circumstances.
The general rule is that you don’t have to have life insurance to cover your mortgage but it is advisable.
Cheap mortgage life insurance
Mortgage life insurance can be more affordable than you think and often premiums are much cheaper.
There are also several ways to help you to save money on your mortgage life insurance premiums. You can be smart about how you get a policy and some simple steps that you can follow:
Healthy lifestyles – people who are active and who have healthier lifestyles will often pay less for mortgage life insurance
Smoking and drinking – some significant factors to your mortgage life insurance premiums are smoking and drinking alcohol
Find the best deals – you can also shop around to find the best mortgage life insurance deals and compare premiums from different insurers. You don’t have to take out cover from your bank or mortgage broker
Decreasing term life insurance – it is generally cheaper to take out a decreasing term life insurance policy compared to level term life insurance
Medical history – be as open and as honest as you can be about your medical history so you can get an accurate premium but remember to speak to an expert if you do have a pre-existing condition
Regularly review cover – it is generally wise to review your life insurance every so often and especially when you change anything with your mortgage
Need mortgage life insurance advice?
It is important to make sure that you pay the right price and get the best cover to protect your home and your family. You can speak to one of our EXPERTS to get FREE and FRIENDLY advice by calling 0800 009 6559 or CLICK HERE.
Our normal office hours are:
- Monday to Thursday 8am to 8pm
- Friday 8am to 3pm
- Saturday 10am to 2pm