Life Insurance7 min read
How much life insurance do I need?
A practical UK guide to working out how much life insurance cover you may need for family, mortgage, debts, and future costs.
4 sources
Read
We compare policies with the leading insurers so you don't have to
97.9%
Of UK life insurance claims paid in 2024
11m+
Mortgages outstanding in the UK
Free
Expert advice with no obligation
What is mortgage cover?
Mortgage cover is life insurance designed to protect your mortgage repayments. If you die during the policy term, it pays out a lump sum that can be used to clear the outstanding mortgage balance, ensuring your family can stay in their home.
Most mortgage cover is arranged as decreasing term life insurance, where the payout reduces over time in line with your repayment mortgage balance. You can also add critical illness cover so the policy pays out if you are diagnosed with a serious illness.
- Pays off your mortgage if you die during the policy term
- Decreasing term cover matches a repayment mortgage balance
- Level term cover suits interest-only mortgages
- Option to add critical illness cover for broader protection
- Joint policies available for couples with a shared mortgage
- Premiums are fixed for the life of the policy
Why Mortgage Cover Matters
Do You Need Mortgage Cover?
Your mortgage is likely your biggest financial commitment. Without protection, your family could face losing their home at the worst possible time.
You have a mortgage
If you died without cover, could your family keep up with the mortgage payments? Mortgage cover ensures the balance is cleared.
You have dependants
If your partner or children depend on your income to pay the mortgage, cover means they won't have to worry about losing their home.
You're buying a home
Taking out mortgage cover at the same time as your mortgage is the most cost-effective approach, because you're younger and premiums are lower.
Types of Cover
Types of Mortgage Cover
The right type of cover depends on your mortgage type and what you want to protect against.
Decreasing Term Cover
The payout reduces over time, roughly in line with your repayment mortgage balance. This is the most popular and cost-effective option for repayment mortgages.
Best for: Repayment mortgages where the balance reduces over time.
Level Term Cover
The payout stays the same throughout the policy term. Suitable for interest-only mortgages where the outstanding balance does not reduce.
Best for: Interest-only mortgages, or if you want extra family protection.
With Critical Illness
Add critical illness cover so the policy also pays out if you are diagnosed with a specified serious illness like cancer, heart attack, or stroke.
Best for: Broader protection beyond just death cover.
Joint Mortgage Cover
Covers both partners on a joint mortgage under a single policy. Pays out on the first death, usually at a lower combined cost than two individual policies.
Best for: Couples with a joint mortgage who want affordable cover.
Key Things to Know About Mortgage Cover
Mortgage cover is essentially life insurance structured around your mortgage. The policy is separate from your mortgage itself, so it stays in place even if you switch lenders. You are free to arrange your cover with any insurer, not just the one your lender recommends.
Getting the right amount and term is important. Your cover amount should match your outstanding mortgage balance, and the policy term should match the remaining years on your mortgage. If you are unsure, our advisors can help you work it out.
- Not compulsory - but strongly recommended by lenders and advisors
- Shop around - you do not have to buy from your mortgage lender
- Match your mortgage - ensure the cover amount and term align with your mortgage
- Review regularly - check your cover if you remortgage, move home, or your circumstances change
Tip: At GoInsureMe, we compare the whole of the UK market so we can find you better cover at a lower price than your lender is likely to offer.
Get Expert Advice
Simple Process
How to Get Mortgage Cover with GoInsureMe
We make protecting your mortgage simple. No jargon, no pressure - just expert advice tailored to you.
Request a Callback
Fill in the form with your details.
Expert Consultation
Our advisor understands your needs.
Compare Options
We find the best policies for you.
Get Protected
Choose your policy and relax.
Knowledge Centre
Mortgage protection guides
Plain-English articles on life insurance, decreasing term cover, and protecting a mortgage.
Life Insurance6 min read
Level term vs decreasing life insurance
How level term and decreasing term life insurance differ in the UK, and which may suit family protection or a mortgage.
3 sources
Read
Life Insurance6 min read
Should you put life insurance in trust?
A plain-English guide to life insurance trusts in the UK, including why people use them, what they can help with, and when to get advice.
4 sources
Read
FAQ
Mortgage Cover FAQs
Common questions about mortgage protection insurance in the UK
Is mortgage cover compulsory in the UK?
No. Mortgage life insurance is not a legal requirement in the UK, and your lender cannot force you to take it out. However, most mortgage advisors and lenders strongly recommend it. Without cover, your family could struggle to keep up with mortgage repayments if you were to die, and they could ultimately lose their home.
What is the difference between decreasing term and level term mortgage cover?
Decreasing term cover reduces over time, broadly in line with a repayment mortgage balance. It is the most common and cost-effective option for repayment mortgages. Level term cover keeps the payout the same throughout the policy and is better suited to interest-only mortgages where the outstanding balance does not reduce.
Can I add critical illness cover to my mortgage protection?
Yes. Many people choose to add critical illness cover to their mortgage life insurance. This means the policy would also pay out a lump sum if you were diagnosed with a specified serious illness such as cancer, heart attack, or stroke. Adding critical illness cover increases the premium but gives you broader protection.
What happens to my mortgage cover if I remortgage?
If you remortgage to a new lender, your existing mortgage cover policy remains in place - it is not tied to the lender. However, you should review your cover to make sure the amount and term still match your new mortgage. If your mortgage amount or term has changed significantly, you may need to adjust your policy.
How much does mortgage cover cost?
The cost depends on your age, health, smoking status, the amount of your mortgage, and the policy term. Decreasing term cover is usually cheaper than level term because the potential payout reduces over time. For a healthy non-smoker in their 30s, cover for a typical UK mortgage can cost from around ten to twenty pounds a month.
Do I need mortgage cover if I already have life insurance?
It depends on whether your existing life insurance provides enough cover. If you already have a level term policy that would pay out enough to clear your mortgage and support your family, you may not need a separate mortgage policy. However, many people prefer a dedicated mortgage policy so the mortgage is definitely covered, leaving any other life insurance for family expenses.
What happens if I pay off my mortgage early?
If you pay off your mortgage early, you can choose to cancel your mortgage cover policy. You will not get a refund on premiums already paid, but you will stop paying future premiums. Alternatively, you can keep the policy running as additional life insurance for your family.
Can both partners be covered on one mortgage policy?
Yes. A joint life insurance policy covers both partners under one plan and typically pays out on the first death. This is usually cheaper than two separate policies, but it only pays out once. Some couples prefer individual policies so that cover remains in place for the surviving partner after a claim.
Should I buy mortgage cover from my lender or shop around?
You are not obliged to buy insurance from your mortgage lender, and shopping around almost always gives you a better deal. Lender-offered policies tend to be more expensive. An independent advisor like GoInsureMe can compare the whole market to find you the best cover at the best price.
How long should my mortgage cover policy last?
Your policy term should match the remaining term of your mortgage. For example, if you have 25 years left on your mortgage, you should take out a 25-year policy. If you are unsure, our advisors can help you work out the right term based on your circumstances.
Testimonials
Trusted by Thousands of Families
See what our customers have to say about us