Life insurance for Mortgage

piyush5

Hi 
I am trying to understand : Do me and my wife need to take a separate life insurances for my mortgage? We both have our life insurances provided by our employers. 

user1977

Whether you need life insurance depends on what you think would happen if either if you dies during the mortgage term. There's no general rule that you need life insurance. 

Bear in mind your employee benefits are only going to help if you die while still an employee - your employment may well have ceased by then, if only because you've been absent for so long due to illness.

amnblog

If you are smart you will review your insurance situation properly with a professional.

Employee benefits are no much use if you lose or change your job. Even with them, you are still likely to be massively under insured.

dimbo61

I like to use the term Life Assurance because we are all going to die.
Well maybe not Superman !
I would also advise Joint Level Term life assurance with a fixed payment for the whole term !
This means the payout remains the same throughout the whole term you have the Insurance.
Keeping the premium the same each month means the Insurance company can't hike the price when you reach your 50,s or 60,s
Shop round for the best price for your ages and health ( smoking )

Sandtree

dimbo61 said:

I like to use the term Life Assurance because we are all going to die.

Insurance - pays out IF it happens

Assurance - pays out WHEN it happens

Whilst we all die at some point if you buy Term Life then it is insurance as the policy may end before you life and so its an IF

Whole of Life is Assurance because it, like you, lasts your whole life and therefore its a WHEN

piyush5 said:

Hi 
I am trying to understand : Do me and my wife need to take a separate life insurances for my mortgage? We both have our life insurances provided by our employers. 

You get hit by a bus 1 week after buying the property... what happens? Can your wife maintain her standard of life, pay the mortgage etc for the rest of her life? Do you care if she can or can't?

Death In Service normally pays out a few years worth of salary, cost of 1 person living in a house isn't that much less than a couple so what happens after those few years? She has to remarry or move out? 

What happens if you change jobs or go contracting and so don't have a Death In Service benefit any more?

Ultimately its your choice, and I know at least one friend who has no intention of leaving his wife a single penny which may be your choice too but its not too hard to sit down and work out the scenarios, depending on if you have/will have kids of what happens if one or both of you die.