My husband and I are buying our first home. What insurance will we need?

Question

Life insurance to cover the mortgage? Illness or unemployment cover? Please help!

Answer 1

get as much as you can afford defo life ins for mortgage.

get ready to be skint !

Answer 2

The following are options that should be considered.

1) Life insurance to cover the mortgage - assuming a repayment mortgage this should be decreasing term insurance joint lives first death. You should also consider term insurance for a substantial amount - the cover should be cheap if you are buying your first home.

2) House buildings and contents insurance. Your lendor will insist of buildings insurance to protect their financial interest in the property but it is susually better to look for your own cover as it will probably be a lot cheaper - the lendor still has to have their name on the policy.

3) Mortgage Protection Insurance (& possibly income protection insurance). This covers you if you are unable to work due to accident/ sickness or redundancy and pays out for a year. You have to be in full time employment for 16+ hours a week for a year to qualify and pre-existing medical conditions are excluded. You can split the level of cover between yourselves - the higher wage-earner has higher cover, or each take out cover for the monthly repayments. I would NOT: repeat NOT buy the mortgage lendor's own policy as it will be expensive and probably have an excess. Have a look at http://www.portwood.co.uk/asuone.htm for a policy aimed at the under 35s (and another for the older). You should also consider that even if your mortgage payments are met you have other monthly bills to consider - so consider taking out a policy to cover those extra bills.

4) Permanent health insurance - will cover you for long-term sickness i.e. if you are off work for more than a year.

Answer 3

If you are not putting 20% down, you'll need PMI.

Assuming you will have a mortgage, the lender will require you to carry homeowner's insurance.

In some areas, the lender might require additional insurance, such as flood, hurricane and earthquake insurance. These types of losses are not covered by regular homeowners insurance.

Make sure your life insurance is sufficient. Most insurance brokers will want to sell you way more insurance than you need.

You don't need disability insurance, but if you can afford it, it really helps when you are injured and cannot pay the bills.

Try grouping your insurance. We save hundreds of dollars a year by having our car and homeowners insurance through the same company.

Answer 4

When you say "need", the only insurance you have to have by law is for your car and you are committing a criminal offence if you drive without the vehicle being insured. Everything else is voluntary. .

But it would be extremely wise to take out a Building Insurance and also a Contents Insurance, and shop around to decide who to go with for them and also make sure they cover exactly what you need and check the small print before signing.But if you do not have these insurances, if some unexpected mishap affects your property like a burglary, subsidence, flooding or storm damage you could lose everything if you do not have proper insurance.

It is certainly worth considering also taking out a cover to protect you against inability to pay your mortgage due illness or losing your job. But these need to be reviewed very thoroughly too before you sign anything.

Answer 5

You will be forced to have house insurance by the mortgage company.

You should probably have contents insurance just in case something gets damaged or stolen.

Insurance to cover the mortgage if you are out of work is worth investigating BUT many are a rip off and won't pay out unless specific circumstances have taken place. Often they won't pay.

Life insurance cover is good - so that if one of you dies, the other has the mortgage paid off and then doesn't have that to worry about.

It will all depend on what you can really afford.

Answer 6

The only compulsory insurance will be buildings insurance if you're buying a house. Life cover, critical illness cover, accident, sickness and redundancy cover, contents insurance are all optional but you should consider them. You need to speak to a mortgage adviser and ask them to go through it all. You can buy all insurances from any provider.

Answer 7

Alot of the time mortage companies include a life insurance on both of you in the loan. They will also require a homeowners insurance so that if the house burns to the ground they still get their money. You will just need to talk to the bank or loan company and see what they require and then go from there on what you can afford for the illness/unemployeement insurance although I have never heard of unenployment insurance

Answer 8

Buildings and contents insurance, life cover, get seperate policies rather than a joint one (twice the cover for almost the same price).

You don't even need life cover if you've got no kids and you're happy to leave a surviving partner with a mortgage to pay off.

Illness or unemployment cover is generally an expensive waste of money.

Answer 9

Increase Life Insurance. Get a good homeowner's policy to cover the replacement of your home plus your contents. Your homeowner's policy should include mines, tornados, earthquakes, high winds and quite a few include identity theft coverage. Stay away from mortgage insurance, a rip off.

Answer 10

If one of you pops you hops the twig(dies)the survivor(s) will lose security and possibly your home.So the first essential ,while you are hopefully,fit and well is plenty of cheap convertible term life cover(this type will allow you later on,when the pressures off)to convert it to a savings policy,and in the meantime give higest protection for a given outlay.I know nobody likes to think of such stuff,but ask yourself'does it happen'?
The next is thing is property insurance,shop around hard,there are huge differences in cost from different companies..
Mortgage protection and critical illness policies are not getting a good press these days.

Answer 11

Your mortgage company or bank will insist on the life cover for you and your husband. You will also need buildings and contents insurance for the buildings and contents of your home. Some sort of illness / redundancy cover would be good but many of these products have little cover and have been badly missold over the years. Unemployment cover has so many exclusions it can be useless but its your call.

xxR