Have you paid (extra) on your mortgage loan? And then also adjusted your term life insurance? 99 percent of households who have paid extra for their mortgage loan is over-insured, according to research by the information platform. The survey was conducted among 516 households with a mortgage loan.
You are not legally obliged to take out a term life insurance policy when you take out a mortgage loan. However, many mortgage loan lenders do not grant a mortgage loan if you do not take out term life insurance. When you die, your income falls away. With the term life insurance, surviving relatives can still continue to pay the housing costs. This insurance is only paid if you die before a certain age.
When you repay on your mortgage loan and all the more if you pay extra, the insured amount of your term life insurance can also decrease, unless you want to spend money on more than your living expenses alone. This ensures a lower premium. The research shows that the mortgage loan debts are reduced by means of repayments, but that the term life insurance policy is not adjusted accordingly. Adjusting the term life insurance policy can save several thousand euros over a thirty-year term. Check in advance whether this can be done with your bank and what costs it brings you.
When taking out a mortgage loan, you can also opt for a linear or annuity insurance policy. With a linear insurance policy, the insured amount decreases in equal steps. With an annuity insurance the insured amount decreases in ever larger steps. Although the insured amounts already fall with these insurances, it may also be worthwhile to adjust these term life insurance policies when you have repaid extra. Even though the savings are expected to be less.
Switching can also pay off
The premiums for term life insurance policies have been halved since 2000. If you have taken out a term life insurance policy for this, you are now probably cheaper when you switch to another insurance company. Please note that you never cancel your old insurance policy before you have been accepted by the new insurer and request permission from the bank in advance.