Summary
It seems that a large numbr of homeowners in the UK have insufficient or no, life insurance. This article looks at the situation and tells us what should be done.
Homeowners gamble on life cover
Everyone knows that if you have a family and a mortgage, then you should have life insurance to repay the outstanding mortgage if you died - as that would leave the home debt free for the family to continue to live in. However, research has revealed that nearly two-thirds of homeowners with mortgages have no life cover - and at least half of those that do, haven't enough cover to fully repay the mortgage.
The extent of homeowners' financial exposure in the event of their death raises fresh worries that, quite apart from apathy and ignorance, the UK's recession is squeezing life insuranceout of many people's personal budgets.
While the figures include those homeowners who do not have dependants or family - and for whom cheap life insurance can be viewed as an unnecessary expense - the implications are potentially ruinous for the majority of borrowers. If the person who pays all or a significant part of the montly mortgage repayment were to die, and as a result the mortgage does not get paid, then the lender can eventually repossess the house and the family will become homeless. Adequate life insurance would avoid this.
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