Life insurance / Mortgage Life insurance

bunnymad

I've just applied for life insurance and afterwards wondered if I should have actually applied for mortgage life insurance?
Is there any realy difference? The amount insured for would cover the cost of the mortgage... but the policy I had before was for mortgage life insurance, so I'm a bit confused.
Should I call them and change it?

Thanks

simpleguy_blr

If the idea is to cover the outstanding mortgage only, then a mortgage insurance has a slight edge, in the fact that you can choose a reducing term mortgage insurance which would be cheaper then the life or full cover.

The catch in reducing term is it will pay out whatever is the outstanding mortgage amount in the event of a mishap...

But if you are planing for covering not just the mortgage, but also some support for your family then a life insurance is a better choice as it pay out the full amount that your life was insured for.

This is my understanding, seniors can correct me otherwise.

Cheers

originalbob

That comparison just about covers it I think.Just a question to the OP though- did you set up the plan yourself or did you get advice from a financial adviser or broker? They should have spelt out the differences to you between the two types of policy for you,and also provided you some sort of details as to what you are actually covered as and when the policy gets going.If you have'nt got one then your insurer should be happy to provide you with the details.