Mortgage repayment & life assurance WWYD

[Kiltedhusband]

The life assurance that was taken out with our mortgage ends next month while our mortgage doesn’t end until 2022 leaving us unprotected for those 3 years. Obviously, this was an oversight. We could take new cover but it will cost £45 per month on the remaining mortgage of £12,000.

We have an ISA that could pay the mortgage off now and not need the life assurance; we could then save the £360 mortgage repayments back into the ISA which will take 33 months to bring the savings back up to £12,000

So which would be the better option?

A. Repay mortgage now, save £405 (mortgage amount & life assurance premium) per month, brings ISA back up to £12,000 in 29 months, no life cover if either should die in that time.

B. Continue to pay the mortgage at £360 per month plus life assurance of £45 also continue to save £100 a month in ISA which would bring ISA up to £15,300 and have life cover if either dies.

C. Continue to pay the mortgage at £360 per month with life assurance of £45 for one year, then pay off the mortgage when it is £8,000

Very undecided what to do, is there a better solution?

We're in our 50's, I have MS and husband had suspected TIA under 50 so mine costs £16 a month and he is £29 neither smokers. The irony is he is as fit as a fiddle, cyles in excess of 200 miles a week and both of us are healthy BMI, but those are the best quotes we could get :(

I'd continue to pay the mortgage and then, if the worst happens, (which it's unlikely to) then cash in your ISA and pay it off.

I’d just leave the life assurance and pay an extra £45 per month off your mortgage to help clear it quicker - if one of you dies in the meantime use the savings to reduce mortgage to minimum amount.

Did you get your mortgage when lenders insisted you had full life assurance covering the balance? They don’t anymore.

So I would either pay the mortgage off with the ISA or let the mortgage run with no life cover. Deciding between these would be based on whether I had other rainy day savings and the interest rate on each.

I don't think life insurance is worth it for you. You have savings anyway and they have given you a really high quote for it.

I would take the mortgage, ditch the LI and save an extra £45 a month.

Does either of you have death in service benefit with your employer? That may well cover the outstanding mortgage if the worst happened?

A for sure is the most risk averse way. I am sure if you pulled things in you could pay back into the isa faster if you wanted.

The insurance is only to pay off 12k - personally I wouldn't worry about it if you have the isa money that would cover it anyway in the event of either of you passing away. You do not have to have insurance just be aware that the deficit of one of you passes away is your responsibility

If one of you dies could the remaining partner afford the mortgage? If so, why do you need life assurance??

(we haven't had life assurance for years, if one of us dies we'd get a payout from work pension which would cover most of outstanding mortgage)

Thanks for all your replies, we have checked, DH has cover with his work pension but I don't so we are going to mull over all your answers. Very helpful thank you :)