Is It Worth Taking Out Mortgage Life Insurance?

I wanted to know if it is worth taking out Life Insurance to protect a mortgage? Is Mortgage Life Cover a good idea?

Question asked by Lotta Simcock
29/03/2019

When deciding whether it is worth taking out Mortgage Protection Life Insurance you really need to think about who you are trying to protect.

Firstly, Mortgage Life Cover is a type of Life Assurance designed specifically to pay out a lump sum to repay your mortgage loan if you were to pass away.

Thus, if you were to pass away the loan could be repaid, leaving the house debt-free to your chosen inheritor. The inheritor is usually a partner or family member(s), and therefore the purpose of this cover is usually to protect family members.

If you do not have a partner or children then it may not be worth taking out cover. However, if you’re in a situation where any partner would have financial difficulties meeting loan repayments on their own then life cover can be a very important policy to take out.

This is why Joint Life Insurance is a very popular plan with couples taking out a joint mortgage.

It is also worth noting that Critical Illness Cover can be added to your Life Assurance plan to cover the risk of suffering a serious illness or injury.

Naturally, with this policy addition the combined plan would now protect you as well as your family, which often makes critical illness protection a worthwhile policy addition.

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