What kind of insurance do I need if I have a Repayment Mortgage?
You need Mortgage Life Insurance.
If you want cover for a Repayment Mortgage
you should take out Mortgage Life Insurance rather than
the normal kind of life insurance. The idea of this kind of insurance
is that the amount covered decreases over time in line with the decreasing
amount of capital that you owe your mortgage lender. As you gradually
pay back your mortgage the amount of cover you require decreases.
Decreasing cover is extremely cost effective.
As you get older, the amount of cover you need is decreasing and this
helps to keep the cost down.
This kind of insurance is also known as Mortgage
Protection Insurance. However, it shouldn’t be confused
with Mortgage Payment Protection Insurance, which is
designed to cover your monthly mortgage payments if you are ill and off
work and therefore unable to pay them.