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Life insurance and mortgages

Life insurance and mortgages

If you’re thinking of buying a mortgage, then you ought to be thinking about taking out a life insurance policy too. Find out how using some of your income today can protect the financial interests of your loved ones if you pass away. 

Kamran Altaf
From the Life team
minute read
posted 5 DECEMBER 2019

What is mortgage life insurance?

Mortgage life insurance can be used to help your dependants meet any future mortgage payments if you die. This type of life insurance is often sold as a decreasing term policy, and it typically pays out as a lump sum. 

How does mortgage life insurance work?

As you pay off your mortgage over time, the amount of life cover you would get if the worst were to happen goes down – just as the outstanding balance of your mortgage does. This type of life cover is usually paired with a repayment mortgage, where monthly payments are used to repay the capital amount borrowed as well as any accrued interest. Learn more about how decreasing term life insurance works.

What’s the best mortgage life insurance cover?

The best mortgage life insurance cover will depend on you and your individual circumstances. For example, you may be slightly older or have a pre-existing medical condition that increases the cost of your policy. Whereas a younger person with no medical problems will get the same cover but at a cheaper cost. 

How much does mortgage life insurance cost?

The amount that you pay for this type of life insurance depends on your personal circumstances, your mortgage and the level of cover that you’re looking for. You’ll often find that a mortgage life insurance policy will cost less overall than, say, a level term life insurance policy where you might pay more to guarantee a pay-out which is fixed for the whole policy life. 

The best way to get an idea of how much you could expect to pay – and whether or not your dependants will get a lump sum after you pass away – is by doing a quick comparison with us, and telling us everything about you and the level of cover you need. 

While it may seem like obvious to say, you’ll need to know how much cover you need and for how long. So, ask yourself what the outstanding balance on your mortgage is and how many years are left before you pay it off. Then simply answer a few personal questions about yourself and we’ll provide you with a range of quotes for life insurance from our panel of providers.

What else should I think about?

So, all you’ll need to do is compare the various options and policy details to find cover that’s right for you. If you’d like some advice on mortgage life insurance, contact one of the advisers at LifeSearch. Give them a call on 0800 072 1147. (Mon-Thurs 8am - 8pm, Fri 8am – 7pm, Sat 9am - 2.30pm and Sun: 10 am - 3.30pm). 

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