Stupid Question - Which Insurances

moomin92

Hi,

Silly question but in general what insurances do people tend to go for when buying a house, understandably House & Contents insurance but do people recommend Life Insurance and Unemployment insurance?

What are your feelings and thoughts on this?

The_Eternal_Optimist_2

As an adviser on these policies I may be slightly biased but a lot depends on your personal situation

do you have a repayment mortgage or an interest only mortgage
Do you have kids?
are you buying on your own or with a partner

moomin92

Buying with Partner, no kids and a repayment mortgage

The_Eternal_Optimist_2

Right how much is your mortgage?

The cheapest way to insure your mortgage is to take something called decreasing term life assurance - this life assurance declines in line with your mortgage so guarantees to pay it off should either of you die

You would also need some critical illness cover, whether you cover the whole mortgage or not is up to you because this type of cover is quite expensive. A lot of my clients will take say, £45-55k contingency criticall illness cover as opposed to covering the whole mortgage with it

Rates on these types of policies are based on how much insurance you need, your age, your occupation, your medical history and whether you are a smoker

Some people, as an alternative to critical illness cover take something called permanent health insurance. This will pay you up to 60% of your pay should you be diagnosed as unable to work through illness or disability. it does not cover redundancy. Again this is dependent upon the factors listed above, and the longer you agree to leave it before you make a claim (a deferred period) the cheaper the policy is. For this reason this policy is often sold with a 12 month mortgage payment protection policy, which will pay your mortgage, insurance premiums i.e. B&C and sometimes an extra 25% to help with expenses in the event of accident sickness or involuntary redundancy.

Sorry if this is all a bit much for you to take in, if you have questions please ask and I will do my best to help you