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I don't have a partner or any dependents, but I do have a mortgage. Do I need life insurance? What would happen to my debt should the worst happen?

by bsajp3 23 March 2010 |

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SoftwareBear posted
If you don't want to leave your property to anybody ... then you don't really need life insurance ... then it's really just saving you money on rent for your lifetime with the possibility of cashing in the investment if you do it before you die.
The mortgage provider will sell the property when you are dead and any remaining equity after their costs will go to your estate.
Posted on 23 March 2010 | Love 1 love Report
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TheWelshman posted
Hi bsajp3
Thanks for your question!
SoftwareBear has some good points here. If you are single with no dependants then who are you protecting when it comes to your death?
The only reason you would really want it in this situation is exactly what SoftwareBear suggests and that is it leave the property to some mortgage free?
There are other insurances you can look at which means you will be protecting yourself rather than someone else. You can look at Critical Illness Cover, Income Protection etc.
If you would like to discuss these in more depth, then let me know and I can arrange for some quotes for you, or if you have any more queries please let me know. You can email me on tim@lovemoney.com or call me direct on 0207 297 8163.
Regards
TheWelshman ( a member of the lovemoney.com team)
Posted on 23 March 2010 | Love 0 loves Report
83

SmudgeButt posted
My parents asked a similar question when they finally managed to kick us kids out of the house. They had investments, cash in the bank and the house (& other properties they owned) were fully paid for. They just needed to cover on going expenses. So they ditched the insurance for themselves.
Instead they used a portion to buy long term health/disability insurance for us kids. They weren't concerned about finances for when they kicked the bucket but were concerned in case something nasty happened to any of us. Besides it was much cheaper to take out policies on a group of twenty-somethings than a couple who at that point were around 60.
The only reason you might think about any sort of insurance is if your mortgage insists on it - and I'm not even sure you would be obliged to have any as long as you are not in negative equity.
AND don't forget most employees do have a certain amount of life cover through their employer, possibly as part of a pension scheme.
Posted on 23 March 2010 | Love 1 love Report
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MikeGG1 posted
Don't forget the cost of the funeral and the wake!
Your will should be specific about whose share(s) should be reduced to pay for any IHT due.
Other than that, it is much more important to cover yourself from redundancy, disability or prolonged illness.
Mike
Posted on 23 March 2010 | Love 0 loves Report

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