Question re life assurance

We are releasing equity from house. We have a existing mortage of €86,000 at a fixed rate of 5.1%( term ends March 2010) and we have applied for a additional €50000 over the same term on a variable rate of 3.6%. We are currently paying €13.62 per month for the orginal mortage and are awaiting a quote for the updated amount. We would like to get the basic cover Mortage Proctection.

i just have a few queries.

1. Is mortage protection enough for the bank or do they required life cover also?
2. How fast can we activate a policy?
3. My husband and I are in good health with no serious conditions, do we need a medical?

Lilysmammy said:

We are releasing equity from house. We have a existing mortage of €86,000 at a fixed rate of 5.1%( term ends March 2010) and we have applied for a additional €50000 over the same term on a variable rate of 3.6%. We are currently paying €13.62 per month for the orginal mortage and are awaiting a quote for the updated amount. We would like to get the basic cover Mortage Proctection.

i just have a few queries.

1. Is mortage protection enough for the bank or do they required life cover also?
2. How fast can we activate a policy?
3. My husband and I are in good health with no serious conditions, do we need a medical?

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1. Mortgage protection is life assurance (it is decreasing cover and is the cheapest form of life assurance). Normally a bank will look for you to have your full mortgage amount covered for the term of the policy.

2. The sooner you apply. Assuming there is no medical or underwriting needed (if you have a healthy medical history) you could have the assurance in place in under a week (again assuming no snags, considering the low amount I wouldnt envisage any problems).

3. That will depend on amount (which is low) and anything on the application form (including family medical history).

My advise is to apply for the full amount of life assurance that you will need to get the ball rolling. You are not obliged to take out life assurance with any provider just because you send them in an application.

Mortgage protection cover will be enough once there is no interest only part to the loan. If there was then the lender could insist you take out level term life assurance cover. It sounds like you have normal repayment loans however so mortgage protection should be sufficent.

Insurance companies reserve the right to request medicals on all applications based on medical history, sum assured and ages of lives to be assured. Normally though medicals are not required once the sum assured is relatively low (like in your case) and once the lives to be assured are in good health.