Just got a Mortgage, do I really need all the extras

splutterbug

I've just got back from Nationwide, and now have my first mortgage approved. As I expected they tried to sell me lots of other stuff as well, some made a lot of sense, some less so.

House Insurance - Apparently I don't need this, I'm buying 50% of a flat and the ground rent should cover this they didn't recommend this

Contents Insurance - Not for me really, I pointed out the yearly premium is more than my current TV costs, Don't really own anything expensive that isn't easily replaceable

Joint Life Cover - This makes sense, but would I be better shopping around

Critical Illness Cover - This seemed very expensive and I wasn't convinced, but I'd be interested to hear what you think.

First time buyer and getting a little overwhelmed, I'm off to finish that bottle of wine, been a hell of a day.

ACG

Buildings insurance is compulsary - if it comes with the buildings management fee then great you dont have to get it through nationwide, but make sure it is in place. (EDIT - Just to note, i dont think you have to get it through nationwide even if its not in the management fee).

You dont have to take contents insurance.

Joint life cover - yes you would get a better deal by going to an advisor, banks charge more and it can sometimes be a stripped down version. You dont have to take this out though.

Critical Illness - expensive compared to.... if you cant work due to cancer/heart attack etc how do you pay your mortgage and bills? State benefits are rubbish. Again you could get this cheaper from an advisor. My personal preference however is PHI/Income Protection, this pays you a monthyl amount (upto 60%ish of your PRE tax income). It pays out if your off work due to ill health (not just one of the 30-40 critical illness conditions covered).

I bet that last paragraph has thrown up more questions than answers?

Hopefully its clarified some bits for you, but fell free to ask away if not.

opinions4u

Shop around for everything.

Research Permanent Health Insurance (PHI) as a possible alternative to critical illness cover. Or having the critical illness policy as part of the life policy.

Use a price comparison site for contents insurance. You might be able to get a bog standard policy for £7 a month or thereabouts.

splutterbug

Wow thank you so much for the PHI advice, I had no idea this was the same thing and I actually already get that for free from work at a better percentage than I was quoted. You've just saved me about £100 per month

bigadaj

splutterbug wrote: »

Wow thank you so much for the PHI advice, I had no idea this was the same thing and I actually already get that for free from work at a better percentage than I was quoted. You've just saved me about £100 per month

You probably get life cover as well through work, whether that is sufficient to cover a mortgage as well is a different matter though.

Goldiegirl

Are you sure you don't need contents insurance?

What if there was a major fire and you had to replace everything you own.

Have you got enough available money to replace all your clothes, CD's, DVDs, furniture, bedding, curtains, cookware, computer, phone ..... Well everything really

Going without contents insurance could be a false economy

owitemisermusa

ACG wrote: »

Buildings insurance is compulsary - if it comes with the buildings management fee then great you dont have to get it through nationwide, but make sure it is in place. (EDIT - Just to note, i dont think you have to get it through nationwide even if its not in the management fee).

You dont have to take contents insurance.

Joint life cover - yes you would get a better deal by going to an advisor, banks charge more and it can sometimes be a stripped down version. You dont have to take this out though.

Critical Illness - expensive compared to.... if you cant work due to cancer/heart attack etc how do you pay your mortgage and bills? State benefits are rubbish. Again you could get this cheaper from an advisor. My personal preference however is PHI/Income Protection, this pays you a monthyl amount (upto 60%ish of your PRE tax income). It pays out if your off work due to ill health (not just one of the 30-40 critical illness conditions covered).

I bet that last paragraph has thrown up more questions than answers?

Hopefully its clarified some bits for you, but fell free to ask away if not.

opinions4u wrote: »

Shop around for everything.

Research Permanent Health Insurance (PHI) as a possible alternative to critical illness cover. Or having the critical illness policy as part of the life policy.

Use a price comparison site for contents insurance. You might be able to get a bog standard policy for £7 a month or thereabouts.

splutterbug wrote: »

Wow thank you so much for the PHI advice, I had no idea this was the same thing and I actually already get that for free from work at a better percentage than I was quoted. You've just saved me about £100 per month

Interesting re:PHI. Never actually knew that existed, thanks for all who've contributed and thanks OP for making this thread.

SandC

Don't dismiss contents insurance, it's really not expensive. Shop around - mine was £179 for the year and I got £50 cash back after I'd had the policy for 3 months. That's for both contents and buildings on a 2 bed end terrace.

kingstreet

Imagine you turn your home upside down. As a general rule of thumb, anything which falls out is a "content" and you'd be amazed at how much it costs to replace clothes, CDs, furniture etc when you are doing them all at the same time.

Cover need not be that expensive, but should be considered important, IMHO.

motch

Yes, i'd check the contents side of the insurance, if it's only a few quid a month would be worth getting.

what's the score if a fire wrecks the place, would just building insurance cover for example replacing electrics, a fitted kitchen and bathroom, painting and redecorating etc ?

kingstreet

Using my example, anything which doesn't fall out when you turn the place upside down is covered by the buildings insurance.