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Mortgage Protection Life Insurance

What is Mortgage Protection Life Insurance?

Mortgage Protection or Decreasing Term life insurance is a policy where your cover amount goes down or ‘decreases’ over time. This means that the monthly premium is lower than that of a level cover policy.

This type of policy is primarily used to cover those individuals with a repayment mortgage.

If you don’t die before the mortgage protection policy ends and you want to stay covered, you will need to take out another life insurance policy.

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Mortgage Protection Life Insurance FAQs

Why should I choose Mortgage Protection Life Insurance?

A Mortgage Protection policy does what it says on the tin – it simply provides financial cover for your mortgage in the event that you pass away before you finish paying it off. This means that your loved ones won’t be left reeling in the wake of trying to continue paying the mortgage off and instead have peace of mind that the mortgage is taken care of.

Mortgage Protection policies tend to be cheaper than Level Term and are suitable for those looking to cover their mortgages. This ensures that the agreement with the mortgage lender is settled, meaning your family don’t have to worry about paying the mortgage themselves.

What are the benefits of Mortgage Protection cover?

Sometimes decreasing term policies are used by those who don’t have a mortgage but want to still provide some financial aid for their families if they were to pass away during the policy.

Are there any considerations with a Decreasing Term policy?

A Decreasing Term policy isn’t particularly suitable for those with an interest-only repayment mortgage, due to the capital debt being repaid when the mortgage term comes to an end.

A level term policy may be more suitable if you’re looking to cover more than the costs of your mortgage and means you could leave a lump sum for your loved ones.

Decreasing term policies do not cover you for life – if you don’t want to limit the period of time which you’re covered for, a whole of life policy might be worth looking into.

You can purchase a decreasing term policy for yourself or for you and a partner – known as a single or joint policy respectively. A consideration with a joint decreasing term policy is that when either of the two holders of the policy die, the other person will not be covered by the joint policy any longer and will require a new policy to make sure they’re protected. Bearing this in mind, it may be more beneficial to set up two single decreasing term policies – ensuring that no matter what happens, both partners are protected.

What affects the cost of a Decreasing Term policy?

As with all life insurance policies, your health, age and lifestyle will influence your monthly premiums and how much an insurer is willing to cover you for. Factors like smoking, height and weight, a history of illnesses and more will contribute towards how big a risk you are to an insurer. Another factor that’s often not thought about by people applying for life insurance is how your occupation can affect your cover – if you’re someone who works at great heights every day, you’re going to be deemed ‘riskier’ than someone who has an office job.

Mint Protection Services

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The legal bit...

Mint FS Limited, trading as “Mint Financial Services” or “Mint FS” is an appointed representative of HL Partnership Limited, which is authorised and regulated by the Financial Conduct Authority. Mint FS Limited is registered in England and Wales with company number 11993128. Registered Office: Unit 6 The Centurion Centre, Castlegate Business Park, Salisbury, Wiltshire, SP4 6QX. The information contained in this website is subject to UK regulatory regime and is therefore intended for consumers based in the UK. Calls may be recorded for training and security purposes and to improve the quality of our services. Mint FS Limited have no control over and are not responsible for the content of other sites. Your home may be repossessed if you do not keep up mortgage payments on it. A fee is payable at outset. We charge a minimum of £395 up to a maximum of 1.5% of the loan amount.