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Four in 10 mortgage holders have no life cover

A total of 43% of mortgage holders in Britain do not have their mortgage contributions covered by life insurance, data from Sainsbury’s Life Insurance shows.

The findings suggest that there are over 7.1 million people with a collective outstanding mortgage balance of £318bn who have no life insurance to cover this.

This represents a 47% increase on the £217bn of mortgages not protected by life cover in 2006, when the Sainsbury’s Life Insurance last conducted this research.

A whopping 62% of 18 to 24 year olds and 44% of 25 to 34 year olds have no life cover.

Of those who pay a mortgage that isn’t covered by life protection, the research indicates that on average they are personally currently responsible for an outstanding balance of over £44,000.

Almost one third of 35 to 44 year olds don’t have life insurance to protect their mortgage payments, and 34% of 45 to 54 year olds aren’t covered.

Lucy Hunter, life Insurance manager at Sainsbury’s says: “Life insurance provides financial cover should the unthinkable happen, enabling people to be secure in the knowledge that their dependants could receive a cash lump sum if they were to die.

“This is particularly important for homeowners, who should take care not to overlook life insurance as it can help to ensure peace of mind that the property is paid for upon death, allowing loved ones to continue living in the family home, and it could also alleviate any financial burden, therefore providing financial security.”

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  • James Hall 3rd November 2010 at 9:30 am

    Why is the focus always on life cover for a mortgage! What ever happened to looking at what overall protection an individual family needs and doing a full job for them. Maybe if we started doing the job the way it should be done over time people would be educated to why they need certain types of cover in certain circumstances. Press coverage focussing on ‘get the mortgage covered’ leads to people either feeling that if they have got this they have nothing to worry about or thinking ‘I am not bothered about the house’ so they dont need to worry. Why doesnt the industry focus on showing people what happens if you havent got income protection or redundancy cover, make it about cover while you are alive and protection for your nearest and dearest when you die. Its about educating people to make informed decisions not just simply flogging them something to earn a few quid commission.

  • Carl 1st November 2010 at 4:13 pm

    Its a case of people thinking, when I die thats the end of my financial worries. Selfish I know but TRUE!!

    Lets see the FSA come up with something for that scenario.

  • Paul 1st November 2010 at 12:24 pm

    I have no life cover for my mortgage because my wife would already be better off financially if I died. In the past, when my earned income was important to the family finances, I had cover for my mortgage through term life assurance. I cancelled this when circumstances no longer required it.

  • John townsend 1st November 2010 at 12:12 pm

    just because you are single doesn’t mean your property should go to the bank or building society on death what about your parents brothers sisters and charities life cover in this country is incredible value for money

  • Leslie Squires 1st November 2010 at 11:19 am

    It will be interesting to learn how many of the 43% are single with no need for life protection. I do not condone mortgages without protection but news like this should be correctly stated and did Sainsbury Life research the whole of the market or just its customers?

  • Leslie Squires 1st November 2010 at 11:17 am

    It will be interesting to learn how many of the 43% are single with no need for life protection. I do not condone mortgages without protection but news like this should be correctly stated and did Sainsbury Life research the whole of the market or just its customers?