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Life Insurance For A Mortgage

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Protect your home to ensure your family can keep it if you pass away

What is mortgage life insurance?

​Mortgage life insurance is a type of life insurance which is put in place when you take out a mortgage. It is usually set to clear the mortgage as a minimum if you pass away so that your family can keep the house.

Mortgage protection life insurance is commonly decreasing term life insurance which means that you take the cover out for the mortgage balance and the amount falls as your mortgage falls.

You can still look at a level policy where the payout amount stays the same for the life of the mortgage. As you pay off the mortgage, this will create a surplus for you to leave for other expenses.

Do you need life insurance for a mortgage?

​If you want your family to keep the house if you pass away then you should put life insurance for the mortgage in place. A lot of families wouldn’t be able to afford the mortgage if one of the incomes is lost from the household. Mortgage protection insurance is life insurance to pay off the mortgage so your family don’t have to worry financially.

Mortgage protection insurance can be put in place if you would like someone to inherit the house, even if they don’t currently live with you. Mortgage protection life insurance can be used to pay off the mortgage so you can leave someone the house debt free. This protects your hard earned deposit and leaves an asset for your family.

Life Insurance vs Mortgage Protection

Life insurance for a mortgage is often referred to as mortgage protection. The amount is often targeted around covering a mortgage but otherwise the cover is the same. When looking at protecting your mortgage it is also important to consider illness cover which will protect you while you are alive and living in the house.

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How much life insurance do I need for my mortgage?

Mortgage protection insurance usually looks to clear your mortgage balance if you pass away. You can also factor in other expenses such as funds to raise children, household bills or anything else that you would like to leave.

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What is the average cost of life insurance per month UK?

Life insurance can cost be from £5 per month. The cost of your life insurance varies based on things such as your age when you take out the policy, your health, the amount of cover and how long you would like the cover.

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What is the average life insurance payout UK?

In 2022 a total of £3,907,342 was paid out in life insurance claims in the UK with the average claim at £73,578***

Why should I take life insurance out?

Commonly people look at their expenses when considering whether they need life insurance in place. Things to consider when thinking about taking out life insurance;

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Do You Have Anyone Financially Dependent?

If you have children who are financially dependant or grandchildren, you should take this in to consideration.

​Even if they are not financially dependant on a day to day basis. Consider if you would like to leave them some inheritance or financial support

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Mortgage or Rent
Payments

Could your family afford to pay these monthly costs including all of your bills without your income. Even if you live alone, you need to consider how long your relatives might need to sort out your belongings or sell a house.

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The Cost of Your
Funeral

The average cost of dying in the UK was £9200 in 2022*. At a time when your family are grieving, you don’t want them to be worrying about this expense.

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Inheritance

With the level of people’s savings dropping as the cost of living goes up, a life insurance policy can be a way of leaving your family a lump sum to give them some financial stability for their future.

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Outstanding Debts In Your Name

As the cost of living rises and there is a lot of reliance on debts, it is important to ensure you are not leaving your family with debts.

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Inheritance Tax

If you have built up your estate to leave your family anything from money to houses, they will be liable to inheritance tax on this over the thresholds. An insurance policy to cover the inheritance tax can ensure your hard work is left to your family debt free.

Frequently Asked Questions

How much life insurance do I need for my mortgage?

Mortgage protection insurance usually looks to clear your mortgage balance if you pass away. You can also factor in other expenses such as funds to raise children, household bills or anything else that you would like to leave.

What is the average cost of life insurance per month UK?

Life insurance can cost be from £5 per month

The cost of your life insurance varies based on things such as your age when you take out the policy, your health, the amount of cover and how long you would like the cover.

What is the average life insurance payout UK?

In 2022 a total of £3,907,342 was paid out in life insurance claims in the Uk with the average claim at £73,578.