Help!! Homebuyers Insurance out of budget.

dunstonh

Will I not need to disclose my current medical conditions in order to transfer any cover?

Yes.

If the conditions are serious, then the existing insurer may have a guarnateed insurability option. This is often able to be activated on things like childbirth or moving house. Not all insurers offer it but some do. And they can still price on the risks they are taking on. i.e high risk = high price.

Aretnap

Paras wrote: »

Only Life Insurance to cover Mortgage.

Are you sure? Assuming you have a relatively normal sized mortgage, £500/month sounds extremely expensive for life insurance only, even with your age and the loadings. Even £50/monthis on the pricey side - it's more than I pay for life and critical illness cover for a house I bought about the same time. Are you sure it doesn't include critical illness cover? (Critical illness cover tends to be several times more expensive than plain life cover).

This is a new mortgage with a different lender. So the old cover will not be applicable I believe.

I suspect that you're mistaken on that. It's a common misconception, but in the vast majority of cases, while the life insurance may have been bought to cover a particular mortgage, it is not explicitly tied to the mortgage. Instead it pays out a fixed sum - or a sum that decreases over time according to a pre-set formula which is intended to mirror the rate at which you pay off a mortgage. So long as you keep paying your premiums, if you die during the term of the policy then it pays out that sum, regardless of whether you still have the original mortgage, you've transferred it to another company, or you've paid it off entirely.

So check exactly what cover you already have - but if you're not significantly increasing the size of the mortgage and/or its term, then it's likely that you already have adequate cover.* If you are increasing it significantly then you may well want some additional cover, but you should only need to look for a policy large enough to cover the shortfall, not the entire new mortgage, and that should help to keep the cost down.


*Adequate to cover the mortgage at least. Of course should you die early or become too ill to work your dependants would presumably have bills to pay over and above the mortgage - you might want to give some thought to what provision you should make for that.

kingstreet

As dunston said, check your existing cover for guaranteed insurability options. These may save you money if you have them.

Paras

Really sorry about the late response. I have been taken over by the stress of buying the new home. Thanks for all your advice. I eventually decided to go for the one in hand as meanwhile the chain was at the risk of falling through. A bigger issue than the insurance. I really appreciate your help guys. Thanks a bunch all.
Paras