If you own a house, or a buy to let property your mortgage is likely to be one of your largest monthly outgoings. This begs the question of how your loved ones would be able to keep up with the repayments in the event of your death.

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How does it work, if you mortgage is decreasing over a number of years then you want a policy to do the same. This type of term policy is usually used to cover the outstanding balance of a repayment mortgage. With a repayment mortgage your debt decreases with each repayment you make. As your outstanding debt goes down, you may find that the amount of life cover you need will also decrease.

Decreasing term life insurance aims to cater for this, and so the total amount of cover decreases over time, roughly in line with your mortgage.

There is another type is called Level term life insurance means that the amount of cover you insure yourself for will stay fixed throughout the term of the policy. This policy is quite straightforward, it will pay out a lump sum if you die within the policy term. The payout is the same regardless of when it happens, and so premiums tend to be higher. Ensuring you know what will be paid and as traditional most but to let mortgage as interest only so the amount you own never changes this will financially protect you should the worst happen.

It’s worth bearing in mind that the amount of cover you need will very much depend on your own personal circumstances, we have someone to help if you want?

You should protect your outstanding mortgage commitments as a start as your mortgage is probably your biggest outgoing.  So you need, check that you have sufficient cover against both capital and interest repayments. The same goes for any other loans you may have taken out.

What happens if you suffer a critical illness. Think about how much time you may need to take time off, and the potential additional financial pressures that may bring?

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