Life Insurance Advice please...

Scott2020

Hi all looking for some advice.

My house i got a mortgage for was £75k.
I took out a decreasing level Life insurance to cover the mortgage should i die.Not being clued up i took the life insurance to cover the cost of the house ie £75k.
I asked the customer rep to advise me with it but said they couldnt.
However i think in total when i pay the mortgage off in full after 25years,i think it totals around £120k at top of my head.
My question is should i have taken the decreasing life insurance cover for the total of £120k and not the £75k? ie the full cost of the credit agreement?

My second question is:
I would like to write my life insurance in a trust should i die.
I understand that once the life insurance policy is written in trust i am no longer in charge of it.
My question is what happens if i need to make changes to the policy once it is written in trust for example my status,occupation change or health change etc etc.Can i still do this once the policy is in a trust? We all know that insurance companies look for the slightest difference in our details in order to avoid paying out.

Both my questions refer to me only as a single policy holder and i am not sure if it matters but i live in scotland.

Any help or advice would be appreciated.

Old_Lifer

The amount of life cover you take-out is entirely up to you.  It is your decision how much life cover you buy.

You should become a trustee yourself when the policy is placed in trust. 

Once a policy has commenced,  any changes in health and occupation do not need to be  reported.

May I suggest that you contact your Life Office,   say that you are considering putting the policy in trust  and  ask for an information pack.

jonesMUFCforever

Assuming the mortgage is repayment terms - you will only need cover for whatever is left on the date you die. This will not be £120k as your monthly repayments will reduce the outstanding amount on a monthly basis.
The £120k figure is the amount you borrowed plus all of the interest that would be charged if your mortgage ran its full term.

Aretnap

The amount of life insurance you need actually depends on many factors, of which the size of the mortgage is only one.

If you have a family for which you are the main breadwinner then probably you need life insurance for a significantly larger amount than the size of the mortgage, as there will still be bills to pay even with the mortgage gone. Would your family be able to pay them without you?

OTOH if you have no family or other financial dependants then you don't really need life insurance at all. Yes if you died the bank would sell the house and take some if the proceeds to pay off the remaining mortgage, but you will be considerably past caring by that point, so buying life insurance just means that a distant relative would get a nice cash bonus on your death. Good news for the distant relative, but you might prefer to enjoy the money yourself while you are alive.