What is Mortgage Protection?
If you die during the term of your plan, whatever is left of your mortgage will be paid off, as long as your mortgage repayments are up to date and your mortgage interest rate has not, on average, risen above the interest rate assumed.
Normally, you will transfer ownership of your Mortgage Protection plan to your mortgage lender. And, as you pay off your mortgage, your cover will fall to reflect the reducing amount you owe on your mortgage. The fact that the level of cover reduces over the term of your plan helps to keep the cost of this plan lower than other forms of life assurance.
Who needs Mortgage Protection?
If you have a mortgage, you need mortgage protection. Generally, your bank will request that you have a mortgage protection policy in place before the mortgage is put in place.
You can protect:
- Single cover
Which means we will make the payment if you die during the term of the plan; or
- Joint Cover
(you and your partner) which means that we will make the payment if you or your partner die during the term of the plan. However, we will only make the payment once.
Who would pay my mortgage if I died?
Protecting your home is one of the most important things you can do.
If you have a mortgage, chances are your repayments take up a sizable chunk of your monthly income. Who would pay this if you died? If you have a mortgage with a partner, could either of you afford to pay your entire mortgage in the event of an unexpected death?
Have you reviewed your mortgage protection?
For the reasons outlined above, mortgage protection is usually a requirement of getting a mortgage. However, because mortgages tend to be very long term arrangements, it can often get overlooked or forgotten about. Therefore it’s a good idea to periodically review your mortgage protection arrangements. You may even save some money!
What is Life Insurance?
Life Insurance is an insurance product where you agree to make a monthly payment to the insurance company in return for a lump sum payment to your family should you die. In most cases, you pay a monthly amount over a set time-frame (20-30 years typically) and the life company agrees to pay your family an agreed amount should you die during this time-frame. This is known as term insurance. They can use this lump sum to pay off bills or the mortgage, and it could give them an income when they need it most. You can choose to take out life cover by itself, or as part of a broader life policy, providing other benefits such as specified illness cover.
Why do I need Life Insurance?
Life Insurance can play a very important part in your financial planning. If you have a family that rely on you providing an income, Life Insurance provides security for the family finances. It can bridge the financial gap between a parent dying and their children being able to work for themselves.
How much is enough insurance?
The average death claim paid out by Irish Life was over €71,500 in 2012. That might sound like plenty, but if you died, how long would €71,500 last for your family?
Life Insurance provides a lump sum so that if you die your family will not have to struggle financially. The amount of insurance you need may vary as your circumstances change, and our financial advisers can provide you with expert advice on how to keep yourself and your family protected.