Can a life insurance policy help cover my mortgage?
7 October 2021
Buying your first home is one of the biggest financial decisions you’ll make. And for many first home buyers, saving for that deposit comes with a lot of sacrifices and dedication which makes it all worth it in the end. Owning a house and starting to pay off a mortgage starts off a new chapter in your adult life.
It is scary to consider that this new chapter in your life might hit a roadblock. Think about what you stand to lose if you’re unable to work due to serious illness or injury. Would you and your loved ones still be able to pay off the mortgage?
Keeping up with mortgage repayments and other living expenses, especially if you or another earning member of your family is impacted by illness or injury, can be difficult. But, if you’ve got life insurance or income protection insurance, covering your mortgage repayments can be a lot less challenging. Here’s how.
Covering mortgage repayments via life insurance
Life insurance can help give you and your loved ones some reassurance to live life confidently if you were to be diagnosed with a terminal illness or pass away. That’s why, even though you may not consider life insurance or think it’s necessary, it can often be an important conversation to have with your family and loved ones. Having that conversation means your loved ones know what to do if you’re not around anymore. A mortgage is a significant ongoing payment for most Australian families. Having a plan in place to reduce the potential financial impact to your loved ones is important.
A Suncorp Life Insurance policy gives a lump sum payment of up to $1.5 million upon death or terminal illness, so your loved ones can have some the peace of mind that they can keep up with ongoing bills and payments easing the stress during this time.
Covering mortgage repayments via income protection insurance
You can also consider income protection. This may provide you with a percentage of your average income coming in while you recover from serious illness and injury and are unable to work for a short period of time. You could’ve had a nasty fall or accident that keeps you out of action for a while. Income protection ensures that you still have money coming in while you focus on your recovery.
Suncorp Income protection insurance covers up to 75% of your average income over the past year, to a maximum of $10,000 a month. The assurance of an income stream coming in can help ease the financial stress.
When you’ve suffered a serious illness or injury, your focus should be on getting back to the best of your health. Receiving a part of your income every month in such circumstances can help you cover most expenses, such as mortgage payments, among other necessary bills.
Be prepared for the unexpected
Thinking about what might happen if you were to unexpectedly become ill, injured, pass away or become terminally ill can be a hard or not-urgent conversation. But having this conversation early and being prepared for the unexpected could be in the best interest of your family and loved ones.
Both, life insurance and income protection insurance can help give your family and loved ones some much needed financial support and a safety net to keep paying mortgage instalments and cover the home that you’ve built together.
And in case you’re wondering, ‘this won’t happen to me’, here’s something to consider. As per figures by ComCare, in a single year, 786,000 people were unable to work due to illness or injury. It’s not as much of a rarity as you might think. What would you do if you were one of those people?
- How income protection can help you and your family in tough times
- Does your family need insurance
- How can life insurance help me?
Suncorp Life Insurance products, other than in some circumstances the Redundancy Benefit, is provided by TAL Life Limited ABN 70 050 109 450 AFSL 237848 (TAL Life) which is part of the TAL Dai-ichi Life Australia Pty Limited ABN 97 150 070 483 group of companies (TAL). TAL is not part of the Suncorp Group. TAL uses the Suncorp brand (part of the Suncorp Group) under license. Any advice on this page in connection with the Life products is general in nature and is provided by Platform Ventures Pty Ltd ABN 35 626 745 177 AFS Representative Number 001266101 (PV). PV is part of the Suncorp Group and an authorised representative of TAL Direct Pty Limited ABN 39 084 666 017, AFSL 243260 (TAL Direct). General advice does not take into account your individual needs, objectives or financial situation. Before you decide to buy or to continue to hold a Life Products you must read the relevant Product Disclosure Statement. The Target Market Determination (TMD) for the product is available on our website.