Life Insurance vs Mortgage Protection Insurance

sonastin

Whichever way you go, make sure you know what your employer provides and only purchase the insurance you need to top this up to the level you want, if it isn't sufficient. For example, if you get 6 months full pay for sickness, you only need the health insurance (either mortgage protection or PHI) to pay out after that 6 months has run out. You can set up the policy to kick in after 6 months and it can reduce your premiums.

Similarly, if your pension provides a lump sum on early death, this can be used to pay off the mortgage - but your family might need it for other expenses so you need to understand the full picture of your circumstances and work out what is right for you.

drummer_666

betmunch wrote: »

You havent said anything about Critical illness cover, did you consider this and discard it or not consider it at all?

Also, Why have you have you gone for Mortgage Payment Insurance rather than Permanent Health Insurance?

Sorry, the insurance I'm getting covers me having no income - whether that is because I'm off work sick, of if I lose my job, or from memory even if I'm taking unpaid leave. I haven't purchased it yet as I haven't bought a property yet.

I'll be paying about £60 a month in total for life insurance (£72k), building and contents insurance and being paid out £800 a month after 30 days of being sick/losing job for up to 12 months

betmunch

drummer_666 wrote: »

Sorry, the insurance I'm getting covers me having no income - whether that is because I'm off work sick, of if I lose my job, or from memory even if I'm taking unpaid leave. I haven't purchased it yet as I haven't bought a property yet.

I'll be paying about £60 a month in total for life insurance (£72k), building and contents insurance and being paid out £800 a month after 30 days of being sick/losing job for up to 12 months

All good.

Is it worth considering a policy that will pay out for sickness until the end of the mortgage/retirement?
You have no prevision for any kind of critical illness after the first year.
Not saying you should have, just want to make sure you have considered it.