Joint mortgage protection insurance (but mortgage in one name) - implications

In my recent divorce I agreed to sign over our family home to my ex-wife (which is half paid off). We had a joint mortgage with joint mortgage protection cover. She now claims she cannot get her own mortgage protection (and thus the lender will not sign over the remaining mortgage to her), and wants me to stay on the joint mortgage protection policy (per request from the lender). Would this have any implications for me - I know I don't benefit, but could this harm my credit rating etc. down the line if my name is attached to this policy?

No, it has no effect on your credit rating at all. If she is willing to pay the full premium then I see no issue other than if you die she will benefit.

The usual issue in these cases is that the lender won't allow a wife to take over a mortgage in her own name because her income does not justify it. Are you sure that this is not the issue? Has the lender confirmed that they are happy to let her take over the mortgage in her own name subject to the life insurance issue?

If so, then just continue the joint life cover. If she can't get the insurance, it's presumably because her health has deteriorated since you took out the joint policy. In which case, it makes sense to keep the joint policy going.

You might have to do an agreement that if you die, your estate will get the proceeds and not her, although they will clear what is left of the mortgage first.

Brendan

Thank you. One potential worry is that I will need to pay the insurance premium (it's fairly high) - on top of maintenance payments - if she stops paying, because the insurance is in both our names. And yes, the lender is happy to let her take over the mortgage subject to the mortgage protection issue.

1rishC said:

Thank you. One potential worry is that I will need to pay the insurance premium (it's fairly high) - on top of maintenance payments - if she stops paying, because the insurance is in both our names. And yes, the lender is happy to let her take over the mortgage subject to the mortgage protection issue.

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If the premium isn't paid, the policy lapses.

Once the house/ mortgage is no longer in your name that's not a concern for you, so non-payment of the premium isn't your problem to pick up.