Decreasing Term Life Insurance
There are 2 main types of life insurance – one of them is Decreasing Term Life Insurance.
This type of life insurance is designed specifically to protect an existing mortgage. Upon death of the policy holder a lump sum is then payable that will pay the outstanding mortgage balance.
The reason it is called Decreasing Term Life Insurance is that the amount payable on death is only ever the amount currently outstanding on the policy holders mortgage. Therefore the level of cover decreases over time but the mortgage is always covered.
If you are married or co-habiting with a partner you can choose to take this type of insurance jointly or as individuals. Although certain products do vary, with joint cover the policy would pay upon the first persons death. Normally joint cover is cheaper than taking two separate individual policies.
Decreasing Term Life Insurance tends to be a cheaper option than Level Term Life Insurance but personal cirumstances can change the premium you are offered so it is worth comparing and considering both options carefully. Sometimes this type of insurance is known as Mortgage Life Insurance as it exists to cover a mortgage balance.
If you would like to find out about your options please complete your details in the Quick Application form above