life insurance / mortgage insurance

village_life

hi - i am a first time buyer just in progress of sorting out my first house... am looking into life insurance as part of that process....

my mortgage advisor got me some quotes for reducing term mortgage cover, however when searching independantly, i have found some offers for both mortgage protection and family protection type insurances....

i dont want to take a mortgage policy out today, then go back in 12 months time and take out family protection when we have kids, so is it better to go for the family protection one from the outset!?

has anyone got any advice for how to calculate the level of cover that would be needed!? - for the mortgage one its easy, but for a generic family cover i guess it has to cover other things like that money will be lost (salary) from my death etc etc...

any generic advice on what route to take!?
:snow_grin

dunstonh

i dont want to take a mortgage policy out today, then go back in 12 months time and take out family protection when we have kids, so is it better to go for the family protection one from the outset!?

As it happens, you probably will change again in 12 months as pension term assurance is being re-launched in April 2006 which will offer better terms than level term assurance.

As it stands, you have two needs. Protection the mortgage and protect the family. Almost certainly 2 plans would be the best option.

There are various ways to calculate the life cover need but the most common one is to to have a sum assured sufficient that 5% of it will equal the net required income. i.e. £100,000 would provide £5000 a year income. So, if you need 10k a year, you need a 200k sum assured.

If your mortgage advisor is independent on the life assurance front (often referred to as whole of market for protection), then you could ask him/her as they can do most types of life assurance.