If you are remortgaging rather than moving home, it is easy to focus purely on the rate and overlook your protection.
You may have arranged life insurance or other cover when you first took out the mortgage, but that does not mean your existing policies are still the right fit. A remortgage is a natural point to review what you have in place and whether it still reflects your mortgage, your income and your family circumstances.
Has Your Mortgage Changed Since You First Took Out Cover?
One of the main reasons to review your protection when you remortgage is that the mortgage itself may have changed.
You may be borrowing more for home improvements, extending the term to reduce monthly costs or restructuring the loan in some other way. Any change to the mortgage amount, term or monthly payment can affect the level and type of cover you need.
If your mortgage has increased, your existing policy may no longer fully protect it. If your monthly outgoings have risen, protecting your income may also have become more important.
Has Your Job or Income Changed?
Your circumstances may look very different from when you first arranged the mortgage.
You may now earn more, rely more heavily on one person’s income or have different benefits through work. In some cases, people move into self-employment, which can bring more flexibility but less financial protection if illness stops them working.
That is why a remortgage is a good time to ask whether you could still meet the mortgage and wider household bills if your income were reduced or lost.
Have Your Family Responsibilities Changed?
If you have had children or taken on greater family responsibilities since taking out the mortgage, your protection needs may have changed significantly.
It is not just about covering the mortgage. It is about whether your family could cope financially if something unexpected happened. Losing an income can have a much wider effect when children or other dependants rely on it.
In some cases, policies such as family income benefit can provide valuable support and may be a cost-effective way to protect day-to-day living costs.
Has Your Health or Lifestyle Changed?
Changes in health and lifestyle can also affect what cover is available and how much it costs.
Sometimes those changes are positive. You may have given up smoking or moved beyond a past medical issue that insurers now view more favourably, which could improve premiums. Equally, if you have developed new health conditions, it may be worth reviewing your options sooner rather than later.
Either way, your existing cover should be checked against your current position rather than left untouched.
Could Newer Protection Policies Offer Better Cover?
It is also worth remembering that the protection market changes over time.
Insurers regularly update their products, pricing and added benefits. That can mean newer policies offer improvements over older cover, whether through broader critical illness definitions, better children’s cover or access to added support such as virtual GPs, mental health services, physiotherapy or second medical opinions.
So even if your circumstances have not changed dramatically, the market itself may have moved on.
Speak to John Charcol About Protection Reviews When Remortgaging
Protection is easy to overlook when remortgaging, but it is one of the most important things to get right.
The aim is not simply to have cover in place. It is to make sure it still does what you need it to do, in the most suitable and efficient way possible. And if you do not currently have cover, a remortgage is a sensible moment to understand your options.
At John Charcol, our specialist protection advisers can review your existing arrangements, highlight any gaps and help you find the right cover for you and your family.
Get in touch on 023 8235 2300.
