Which Insurance?

[The Tiggster]

What is best for covering a mortgage?
1) Mortgage protection
or
2) life assurance with critical illness & use that to pay off mortgage if anything happens.

I know that option 1 is cheaper, but I do not have life assurance (have 7 month old baby) but my husband does. In that case, would option 2 level term be best?

Thanks

[PFA]

Simple answer - ask your mortgage provider to provide you a copy of the DEMANDS AND NEEDS statement.

- Try to answer them questions without bias. (It is harder than you think)
- Sometimes it may be cheaper to go for them individually / other times it may be cheaper to stick to your lender.
- The MAXIMUM any ins policy can pay re income protection / replacement is only 65% (from the top of my head) by law. Any more and the insurer will be penalised for this.

If you take them individually - please bear in mind that they only protect you and not the actual lending product - You may either end up being underprotected / overprotected.