What is Life Insurance?

Life insurance is designed to pay a lump sum in the event of death which is generally used to repay the outstanding mortgage so that the family left behind still has a roof over its head. 

The amount of cover you have should be at least as much as your mortgage.

Depending on the type of mortgage you have you will need either a Decreasing Term or Level Term policy.

Decreasing Term - This is most suitable for repayment mortgages as the level of cover decreases over time so that it us always just enough to repay the outstanding balance on your mortgage. The benefit of this type of policy is that it is the cheapest form of mortgage life insurance.

Level Term - With a Level Term policy the amount of cover does not reduce over time. This is essential if you have an interest only mortgage where the capital is not being reduced. It can alos be set up alongside a repayment mortgage and will simply mean should you have to claim there may be an excess paid out over and above the amount needed to clear the mortgage.

Why do I need Life Insurance?

Ask yourself this..If you or your partner died tomorrow, how would you pay your mortgage with only one income? Even if the surviving partner is the main bread winner they may not be able to continue working as they have to look after children etc.

Life Insurance takes away some of these worries by removing your biggest financial commitment should the worst happen.