Life Cover for Shared Ownership properties??

tedzwedz

Hi I have Life Cover with Royal London which my shared ownership broker arranged.

It seems very expensive at £33 per month £396pa. When I google life insurance cover some say from £5pm etc! My question is would that cover me on Shared Ownership or is it a different form?

I bought a 25% share in my flat with a mortgage, the rest I rent from the freeholder and may buy more in the future.
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Its a 25 year policy which is inline with the mortgage term and covers £532,500 which is apparently the full value of the flat (100%)

Can anyone help?

Best Edward

dunstonh

It seems very expensive at £33 per month £396pa. When I google life insurance cover some say from £5pm etc!

I doubt it is like for like at that cost difference.

Usual reasons for cost differences of that size are:
1 - existing plan includes critical illness cover. Alternative does not
2 - existing plan is guaranteed premiums for the whole term. The alternative is annually reviewed and increase as you get older.
3 - Its not a real quote and just an advert saying "from £5"

Its a 25 year policy which is inline with the mortgage term and covers £532,500 which is apparently the full value of the flat (100%)

That wont be £5. I have just bought £600,000 of life assurance for 22 years and its £91pm. Age is part of the reason as I am in my 40s. But you are never going to get £532.5k for £5pm.

kingstreet

You must be paying over £1,500 a month in mortgage and rent costs and someone has protected your family so that in the event of death there will be no mortgage to pay and 100% ownership can be obtained so the rent also ends.

£33 a month expensive? Not likely. It's just over £6 per £100,000.

tedzwedz

Hi Guys, thanks for your reply.

Its a 1 bed flat under the shared ownership scheme, I pay about £450pm in mortgage for my 25% and about the same in rent for the 75% shared ownership bit so about £900pcm.

I think that's the idea, I think if i die my brother would get the property and pay off the rent so no longer shared ownership?

I was just wondering if this seemed high per month if so i could look to shop around?

Best Edward

Weighty1

So you don't have a partner/kids?

If not there's very little value in you having life insurance. Do you have income protection so that you can maintain the mortgage/rent if you are ill? If not, I'd suggest you look into this as a priority as this would be far more beneficial than life insurance

kingstreet

tedzwedz wrote: »

I think that's the idea, I think if i die my brother would get the property and pay off the rent so no longer shared ownership?

I agree with Weighty.

Did you specifically want to leave the property to your brother?

Most people who are single no dependents have no demonstrable need for life cover, especially if they don't want to leave the unencumbered property to a particular relative.

tedzwedz

Thank you, would the Income Protection be part of the same policy or a new one?

Weighty1

Some insurer's allow income protection cover to be taken as part of the same application process, however, it would normally be a standalone benefit. In addition to this, there are a lot of Friendly Societies which offer income protection and don't offer life insurance so looking for it to be part of the same application means you may not get the best overall provider for your circumstances.