Four out of ten mortgage holders do not have their mortgage contributions covered by life insurance, according to new research from Sainsbury's. The findings suggest that there are nearly seven million people with a collective outstanding mortgage balance of £245 billion who have no life insurance to cover their mortgage and provide support to their dependents in event of their death.
On average, those who pay towards a mortgage and are not covered by life protection are currently personally responsible for an outstanding balance of over £36,000.
Worryingly, many of those in age groups who are likely to have dependants are unprotected, with the research showing that one in three 35 to 44 year olds have no life insurance to protect their mortgage payments, and nearly a third of 45 to 54 year olds do not have this type of cover.
Helen Williams of Sainsbury's comments: "Mortgage repayments are one of the biggest financial commitments in many peoples' lives but unfortunately it is not something that enough mortgage holders have taken steps to protect. There could be many reasons for this, perhaps some may feel it is less of a priority than other items on their household budget however, being unprotected could have serious implications. Having life insurance gives those with a family peace of mind that should the unthinkable happen and they die, their dependants can continue living in the family home with the lifestyle they have without worrying about the financial implications. We would urge anyone who doesn't have life insurance to consider taking out a policy, and those who do and have moved to a bigger house to make sure it is updated to reflect their mortgage commitment."
Life insurance news: 6 November 2011