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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

Life insurance?

33 replies

mangosparkle · 15/11/2021 14:02

AIBU about our life insurance? Took it out for the first time last year through our mortgage broker and it's £60ish a month for me + DH for life insurance & critical illness cover. This seems really high to me, but don't really know anyone else who has life insurance who I can ask! What do other people pay roughly? We are early 30s and no major health conditions.

OP posts:
itsanotherfineday · 15/11/2021 14:08

Do you need critical illness cover? Most of the premium will be for this, as life cover for people in their 30s is relatively cheap. If one of you became ill could the other cover the mortgage?
What sickness benefits does your employer provide?

DDUW · 15/11/2021 14:10

This reply has been withdrawn

Message from MNHQ: This post has been withdrawn

2thumbs · 15/11/2021 14:11

What level of cover does that get you, and for how long?

Timeforabiscuit · 15/11/2021 14:16

What do you have life insurance for? We have it set off to pay off the mortgage and funeral costs and is a fixed payout. If you want it to cover critical illness etc it will cost more, but if you need two wages to cover the rent and bills it's worth it.

Other options are dependent on your life circumstances, how good your employment contracts are and how flexible your outgoings are.

Original poster
mangosparkle · 15/11/2021 14:18

Thanks for the replies so far! We have a mortgage of about 200k and neither of us could cover the repayments on our own, so we felt that critical illness cover was needed. DH has a year of critical illness cover through work, but I have nothing (currently on a short term contract).

We do have individual policies, but they were taken out at the same time with the same insurer, which is why I referred to them together. The life insurance cover seemed fairly comprehensive - my understanding is that if one or both of us died, it would pay off the mortgage in full.

OP posts:
minimecantrollerskate · 15/11/2021 14:24

I have never had this insurance due to the cost of it, but some friends did and when one of them was diagnosed with a low grade cancer the policy paid out and they were able to pay off debts and some of their mortgage. They are currently in remission and should be around for a long time yet due to the type.

I would shop around though, you could go to a different broker and see what they can offer you.

askingforafriend80 · 15/11/2021 14:34

That sounds about right to me, me and my dh are a bit older and ours is around £100pm we have critical illness and life insurance. You can shop around though if you aren’t sure. If you can afford it I really recommend having both.

DGFB · 15/11/2021 14:36

We pay £60 for two
Life insurance premiums (mid 40s). Critical illness cover is expensive

Original poster
mangosparkle · 15/11/2021 17:05

Brilliant, thanks everyone. I'll shop around, but good to know we're not overpaying!

OP posts:
PingedPotato · 15/11/2021 17:07

It's worth considering only covering part of the mortgage if the whole thing is too expensive.

PingedPotato · 15/11/2021 17:08

It's not an ideal but anything is better than nothing

FusciasBright21 · 15/11/2021 17:14

We were given a quote by our mortgage brokers of £75 per month for life insurance and critical illness cover. We're still shopping around, I think initially we'll just get basic life insurance (one quote was only £15 per month) and then when we know what our new outgoings are likely to be we can add critical illness cover.

Brainwave89 · 15/11/2021 17:23

So if the insurance is to cover your mortgage is it level term of decreasing? Level pays out the same say £200k if you die, decreasing goes down as you repay the mortgage and is consequently cheaper. For CI cover there is often a lot of confusion as to when it will pay up. For most policies, it is when you are diagnosed with a number of very serious illnesses. The range can be quite narrow in practice, so it is worth checking if this meets your needs. Permanent Health Insurance (PHI), is the product which provides a regular income for a period if you are not able to work.

Dogsandbabies · 15/11/2021 17:45

Sounds about right. I only pay £11 a month but I don't have the critical illness cover and if is a single policy for just me.

Lemonsyellow · 15/11/2021 17:48

I think that sounds OK. My DH pays £70 a month for a ten-year policy just for him, but he’s in his 50s. I can’t get life insurance at all.

DysmalRadius · 15/11/2021 17:52

You're much more likely to use critical illness cover than life insurance - I know a lot of people who have had heart attacks or cancer in their 40s/50s but it's quite young to die!

BigYellowHat · 15/11/2021 19:40

That’s cheap! £280 pcm just for DH. Mine is about £80 pcm but I’m only covered for about 2/3 of our new mortgage as my medical condition meant I couldn’t find anywhere willing to extend my cover.

BigYellowHat · 15/11/2021 19:41

Luckily I’ve got £50k critical illness and 6 months full and 6 months half pay on sick (nhs)

Badgerloco · 15/11/2021 19:46

That sounds about right. The older you get the more expensive it gets, so you may not save anything by shipping around a year later - every half birthday the premiums increase (for new policies). I work in this field and the selling point is, you are so many times more likely to get a critical illness over the next 20 years. Compare providers carefully. Some don’t cover as much as others.

TotallySuper · 15/11/2021 21:12

@itsanotherfineday

Do you need critical illness cover? Most of the premium will be for this, as life cover for people in their 30s is relatively cheap. If one of you became ill could the other cover the mortgage? What sickness benefits does your employer provide?
Omg OP ignore rhis, everyone bar very very few needs CIC. Life cover is rarely claimed on but CIC payouts are often and many. 1 in 2 will now get cancer. £60 is cheap for decent long term cover for a high amount.
TotallySuper · 15/11/2021 21:13

@mangosparkle

Brilliant, thanks everyone. I'll shop around, but good to know we're not overpaying!
Cheapest is not best. Read the fine print and the amount of illnesses covered before proceeding.
TotallySuper · 15/11/2021 21:14

Sorry I get quite passionate about this sort of thing, qualified financial planner here. Have helped many clients through claims process after original setting up their cover.

TotallySuper · 15/11/2021 21:31

*originally

itsanotherfineday · 15/11/2021 21:31

It's a perfectly legitimate question @TotallySuper . If you have other coverage or mortgage well supported then critical illness is expensive insurance that may not be necessary. If it is necessary then OP should keep it.
You're not the only qualified financial planner on MN and you have no idea of OPs circumstances.

TotallySuper · 15/11/2021 21:42

@itsanotherfineday

It's a perfectly legitimate question *@TotallySuper* . If you have other coverage or mortgage well supported then critical illness is expensive insurance that may not be necessary. If it is necessary then OP should keep it. You're not the only qualified financial planner on MN and you have no idea of OPs circumstances.
Neither do you but its a dangerous question regardless.