Mortgage Payment Protection Term?

bluewire

I am a little confused whilst looking in to reducing my insurance costs (insurance is with the bank who i took the mortgage with and is far too many £££)

I am looking at a level term (£90,000) for me and my wife however I am confused around the term I should get it over.

My mortgage is 15 years....however do I need to take the insurance for that term or can i choose a reduced number of years (5?)

The 5 years is around £7 lower than the 15 years (Guaranteed price)

Thanks

dunstonh

My mortgage is 15 years....however do I need to take the insurance for that term or can i choose a reduced number of years (5?)

If the mortgage is 15 years and you set it up for 5, what happens if you die in year 6?

bluewire

I start a new policy within that time and cancle the 5 year one???

Whats to say that it will take me 15 years to pay the mortgage off? It may be either side of the 15 years.

That is why I am confused.....am I missing something and looking stupid?

dunstonh

I start a new policy within that time and cancle the 5 year one???

Which assumes your health situation hasnt changed. Plus, 5 years on you are more expensive to insure. Basically what you propose is not cost efficient and it carries risks.

Whats to say that it will take me 15 years to pay the mortgage off? It may be either side of the 15 years.

And you make changes if changes are required. Such as including guaranteed insurabilty in the policy.

bluewire

All good points.

Thanks for your help