Life Or Mortgage Insurance

[col72]

the wife is looking to take out her 1st insurance bit lost on subject we have a mortgage so does she take out a mortgage 1 or just life insurance

[boxtops]

They are two different types of policy. If you have a mortgage then the policy on that is a mortgage protection policy - the value of it gets less as time proceeds over the term of the mortgage, it's only intended to give a sum assured to pay off the mortgage if the insured person dies.

A whole life policy is just that - you pay in all through your life, it only pays out when you die.

What's the reason for her wanting to take out insurance? Is it to protect the house if she dies and you then couldn't afford to pay the mortgage, or to leave a sum of money for the family as an when she passes on? Have you got a mortgage protection policy on your own life already?

She doesn't have to have life insurance - we haven't.

[Peter Pedant]

rules change

and remember that one rule is - the bankers must make as much money as poss w/o a vestige of service and will change the rules to suit

I wouldnt insure against mortgage failure as that was the basis of the PPI scandal - they took money when they knew they would never pay out.

Life insurance goes around in various bits

the cheapest is 'term' - you pay regularly and within the time limit and if you are paying the premium then in the event of death of the insured party ( sorry getting a bit technical ) , you get a pay out. At the end of term, you or wife get nothing if she hasnt died

Other insurances have a savings portion and they have value at the end of the term. These used to be called endowments. They were good value and now arent. One of mine is coming in - in ten days (!!) and will pay out £10k altho it was designed to pay out £20k. Oops bad value there.
But remember the fact that my investment was a dog doesnt mean yours wont be

Oh and you dont need life insurance for a mortgage altho that used to be the rule. I am uninsurable ( but sure know alot about insurance ! ) as a result of cancer but have had three. ( mortgages not cancers)

Oh oh and dont lie on your insurance form - they wont pay out if you do.
( uberrima fide rule )

[boxtops]

I agree peter - I had term assurance to cover my mortgage, rather than straight MP (and col, remember that if it's your mortgage lender pressuring you to take out life insurance, you don't have to take it through them, you can shop around - they'll be on commission).