Hi Belini,
I wouldn't worry too much about the new policy being subject to higher rates unless there has been a change (for the worse) in your medical circumstances. By all accounts it appears that life cover rates have been falling. In fact if you get a quote for mortgage protection cover on BOTH lifes, you may even find that it that it works out cheaper than just getting a policy for your husband when added to the cost of the policy you are currently paying for!
Don't do the cover with the bank though. The bank can only sell you their product. Get advise and get the best rate on the market. It's also worth checking whether or not your current policy is a mortgage protection policy (decreasing cover) or normal life cover (a level sum assured throughout the term). Many banks sold the later with the higher premium.
If it's just life cover, get the cheapest policy as the terms are relitively the same with each insurer, i.e. you have to be dead to claim! If however you are getting serious or critical ilness cover it's important that you get advice as to what is the most comprehensive product. Also make sure that you get the most up to date outstanding balance on your mortgage, as this should be the new sum assured and not amount you initially borrowed. The same is true of the term of the policy, write it for the remaining term, not the initial term.
Once you get your policy, go into the bank, give them the original and they will request that you sign a deed of assignment in their presence. DO NOT LET THEM CHARGE YOU FOR THIS. There is no justification for this. On doing so request the immediate cancellation of the direct debit on the old life cover and request that the policy be released from their assignment so that you can cancel it.
You can of course just take out a seperate policy for your husband and keep it for your own file, but I suspect will will be cheaper the other way, even if it initially requires a little more hassle. After all you could be paying this for the next 25 years!!
I hope that helps!
Patrick
