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Mortgage Protection Insurance

Your mortgage is probably your biggest financial commitment, so it makes sense to cover it
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What is mortgage protection insurance?

Your mortgage is likely to be one of - if not the - biggest financial commitment you’ll ever make. You may have saved up for years to get on the housing ladder and now you have, you’ll want to protect that all-important mortgage! Sure, mortgages aren’t particularly exciting but having your own home is, so some kind of relevant insurance should be up there on your list of priorities.

That’s why there are specific mortgage related insurance policies out there designed to handle this debt when you pass away - such as mortgage protection insurance (also knows as mortgage life insurance). But with life insurance out there too, which should you go for and how do they differ?

Do I need mortgage protection insurance?

Do you ‘need’ to get it? Not in the legal sense. But ‘should’ you get it? Yes. Otherwise, who’ll pay your mortgage if you’re not around? You’ll either pass on the debt to your loved ones, or in a worst-case-scenario, the lender will take the house back.

Both are avoidable if you protect your mortgage, and ensure it’ll get paid if the worst happens to you.

How much does it cost?

As with almost any insurance product, premium prices differ from person to person and mortgage to mortgage, based on varying factors. This could be things like your age, health, medical history and lifestyle (such as whether you are a smoker and how much alcohol you drink), and the size of your mortgage.

However, mortgage protection tends to be cheaper than life insurance as it’s a decreasing risk - the more you pay off over time, the less your pay out will need to be.

Use our quick life cover calculator to get started

What’s the ‘right amount’ of life cover?

It’s different for everyone. To figure out the ‘right amount’ of cover for you, you’ll want to factor in your outstanding debt, your family commitments (now and in future) and what you can afford to spend each month in premiums.

Our calculator will help. And after you calculate the ‘right amount’ of cover, give us a call (or leave your details we’ll call you) so LifeSearch can search the market for policies that match what you’re after.


Plug in your commitments to understand what cover's good for you.


Any mortgage left to pay?

How much have you left on any current mortgages in your name?


Loans, credit cards & other debts

Total up all the non-mortgage debt you have: loans, credit cards, overdrafts and any other borrowing


Potential funeral costs

The average UK funeral costs between £4,000 and £5,000. If you have expensive tastes or a massive family, it may be more. Worth thinking about.


Childcare, school or higher education costs

You’ll know your childcare, private school or tuition fee obligations. But did you know it costs roughly £1,500 - £2,500 per year to fund one child through state school? There’s sports, activities, after school clubs, uniforms, travel expenses, technology (such as a laptop or iPad) to consider.


Additional lump sum

Life insurance covers your obligations and debt. A lump sum on top offers extra comfort and options for your family after you’ve gone

£ -

Existing life insurance, savings & investments

Total up any savings, investments and life insurance policies that you intend to keep. When you die your savings go towards your debt anyway - so it’s important you’re not ‘over-insured’. That’s just a waste of money.

Your total cover estimate:

£ 0

Let us find the best cover for you!

Get advice & quote

Not sure about your calculation? We can help you choose the cover level to suit you with free advice here.

Remember, this only estimates how much you might need to help you make your decision.

What are my options?

There are two main kinds of mortgage protection insurance, level term and decreasing term.

Mortgage protection insurance decreases alongside your mortgage balance, whereas level term cover stays at the fixed amount for the full duration of your policy.

Level term mortgage life insurance

For level term your cover remains the same and stops after an amount of years

Let’s say you’ve a £250,000 mortgage and you buy £250,000 in level term mortgage life insurance for 25 years.

The ‘level’ bit is key. It means the total amount you’re insured for (£250,000) stays the same across those 25 years.

  • If you die on day 9 your loved ones’ pay-out will be £250,000.
  • If you die on day 900 your loved ones’ pay-out will be £250,000.
  • If you die on day 9,000, your loved ones’ pay-out will be £250,000.

Over time, you’ll owe less and less on your mortgage. So if you die late in your policy term, your loved ones can pay off what’s outstanding on the house, with plenty of that £250,000 left over for other things.

Advantages of level term cover

  • Your premiums won’t change
  • You know what your loved ones will get
  • Extra financial support (assuming you die late / later into your mortgage term)

Disadvantages of level term cover

  • It can be more expensive
  • Takes no account of inflation (you may be able to add this on at a later date – see below)

Decreasing term mortgage life insurance

For decreasing term your cover reduces over time in line with e.g. a mortgage

Let’s say you’ve a £250,000 mortgage and you buy £250,000 in decreasing term mortgage life insurance for 25 years.

The ‘decreasing’ part means the total amount you’re insured for (£250,000) decreases alongside your mortgage.

Say you die when there’s £150,000 left on the mortgage. That, then, is the lump sum pay-out.

Die with a year to go and your mortgage may be £10,000 – that then is the lump sum pay-out.

Advantages of decreasing term cover

  • Often cheaper than level term
  • Peace of mind your mortgage is covered
  • Premiums are fixed and will not change during the duration of the policy

Disadvantages of decreasing term cover

  • Pay out value decreases over time
  • Just covers mortgage, no extra to leave behind

A Little more about LifeSearch

Life insurance isn’t fun. There are several kinds of life insurance policies to choose from, and dozens of providers with their own versions of those products.

Without LifeSearch in your corner that’s a lot of reading … reading you don’t have to do.

Frequently asked questions about mortgage life insurance

Ready to take the first steps to get protected?

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LifeSearch Limited is an Appointed Representative of LifeSearch Partners Limited, who are authorised and regulated by the Financial Conduct Authority. Calls may be monitored/recorded.