When you take out a mortgage it is always advantages to take Life Insurance to repay any outstanding Mortgage on the loss of the person(s) who is on the Mortgage.
The loss of a spouse or parent can leave dependants with additional issues to cope with other than emotional.
How would your spouse and dependants cope in a very difficult time if they had to move out the family home as they now could not afford to live their.
If you do not have Life Insurance the Mortgage debt passes to your next of kin. They will then be responsible for the mortgage. This situation can be avoided by taking out a policy to cover this if this happens.
A life insurance policy pays out a lump sum or income to dependants in the event of your death.
The policies normal associated with a Mortgage are:
Level Term Assurance: Pays out a set lump sum of money in the event of the policy holder’s demise. These are good for personal or family protection or to cover an Interest Only Mortgage.
Decreasing Term Assurance: Pays out a lump sum to repay a Repayment Mortgage on the policy holder’s demise.
Family Income Benefit: Pays out a lump sum on a monthly or annual basis on the policy holder’s demise.
Policies can be arranged in Joint names or can be taken out individual.