If you have a mortgage on your home, you may need to take out life insurance, also known as mortgage protection. This is to satisfy your lender that you'll be able to repay all the money you've borrowed - especially if you were to die unexpectedly during the repayment period.
After all, if you died without life protection whilst still repaying your mortgage, the lender might have to re-claim your property, to the obvious detriment of your family. Why choose Endsleigh? We are whole of market, which means we compare insurers from across the market. Our advisers will ensure you have the right level of cover for your needs. If you already have life insurance in place we can review this to ensure it still suits your circumstances at the most competitive price.
Decreasing term assurance is often chosen to protect a repayment mortgage instead of level term cover. The life insurance sum decreases in value each month in line with the decreasing loan amount borrowed from the mortgage lender. The cover should have a term that matches the repayment term of the mortgage, so they both come to an end simultaneously. As this cover is designed to protect your mortgage repayments only it is cheaper than level term life insurance.
With an interest only mortgage it is only the interest on the mortgage loan that is paid off, with the capital of the mortgage paid through a separate investment plan.
The life insurance required for this kind of mortgage is called a level term life insurance plan, where the sum insured stays the same throughout the life of the plan. Again, when the policy comes to an end after you've paid off the mortgage should the level term life insurance cover.