09 November 2011 / by Colm Hebblethwaite
A large number of people in the UK have taken out a mortgage in order to get their feet firmly on the property ladder, but a new study has shown that a substantial amount of these people do not have their mortgage payments covered by a life insurance policy.
The figures, released by Sainsbury’s Life Insurance, show that around 41% of mortgage holders in the UK have not taken out a policy that guarantees that their families and dependants will continue to be able to pay off the mortgage in the event of their death.
This roughly equates to nearly 7 million people, who collectively have an outstanding mortgage balance of around £240 billion. The study also found that the average individual liability for people those mortgage payments are not covered by life insurance is over £36,000.
“Mortgage repayments are one of the biggest financial commitments in many peoples lives,” commented the head of Sainsbury’s life Insurance Helen Williams, adding that the research seemed to show that not enough mortgage holders had taken the necessary steps to protect that commitment. Possible reasons for this could be that insurance is simply low down on the list of people’s priorities or that their household budgets do not stretch that far.
Among the age groups surveyed, around 55% of 55-64 year olds and 33% of 35-44 year olds were not covered by life insurance when it came to their mortgage repayments.
Taking out a life insurance to cover a mortgage can give many people the peace of mind that comes when you are able to go about your life in the knowledge that both you and your family are protected as much as possible form potential future events.
Schemes such as Sainsbury’s Life Insurance start form as little as £5 a month and can be regularly updated to suit changing circumstances.