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Why you need life insurance when buying a home

Why you need life insurance when buying a home

Author: Pranil Maharaj
Date: 2018-05-25

It's said that buying a house is one of the most stressful life events, and if you've recently entered the property market, you're probably vigorously nodding your head.

It may surprise you to learn that, if you have a home loan and something bad happens to you, you could lose your home. If you can no longer afford to make the bond repayments because you get sick, become disabled, or even die, the bank will sell the property, and if that happens, where will your family live

How does life insurance protect my family Life insurance, unlike mortgage protection insurance, covers more than just your home loan, it is used to cover your debts so that your loved ones aren't left with any hefty bills to pay.

Do I have to have life insurance as a homeowner Strictly speaking, you don't, unless the bank or bond originator that's giving you the home loan requires it.

How much life insurance do I need In this case, the right amount of life insurance is enough to cover your home loan if you die. Of course, if you don't already have life insurance to cover your other debts, you probably want to get enough cover to make allowance for that too.

What if I already have life insurance It means you're ahead of the curve, but you should definitely check if your current policy provides enough cover for the extra debt of a home loan.

Where can you get it Well, for one thing, you don't have to get it from the bank that's giving you the home loan.

When should you get it If you have dependents and no life insurance, getting life insurance should be really high on your priorities, regardless of becoming a new homeowner.