If you have a mortgage on your family home, you are legally required (with some exceptions) to have life insurance cover to pay oﬀ the mortgage should you die before the end of the mortgage term. This is called mortgage protection cover.
Most lenders oﬀer this cover as part of their home loan package. However you are not obliged to take their cover. You can arrange such cover yourself and there are many advantages in doing so:
- With help from your Financial Broker you can search the market for the most competitive mortgage protection policy cover available (lenders typically use just one insurer for their mortgage protection cover).
- You own the cover yourself so if you move to a diﬀerent lender, you can take the cover with you. Lender’s mortgage protection cover, on the other hand, ceases when you move your mortgage to a diﬀerent lender and you would then have to take out fresh cover.
Note: You do not have to take out mortgage protection insurance if: you are aged over 50; the mortgage is not on your principal private residence; you cannot get the insurance or can only get it at a much higher premium than normal. These are exemptions to the legal requirement to have mortgage protection life cover in place. However, your lender may still specify mortgage protection life cover as a condition of the loan oﬀer even if these exemptions apply to you.
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