Mortgage protection: obliged to update insurer re health during the term?

tripps

Registered User
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8
Hi there,

My wife and I have been on a tracker mortgage for approx. 9 years, and have had a joint mortgage protection insurance (reducing term cover) with Irish Life for that period. A couple of years after starting the mortgage, my wife was diagnosed with a genetic form of breast cancer. She has since completed her treatment and while not "cured", she's been in remission for a number of years.

Should we have informed Irish Life when she was diagnosed? We scanned our policy last night but couldn't see anything explicitly indicating that we should have.

I'm asking because we are now hoping to transfer our mortgage to another house. We're not sure if that will mean a re-assessment of our existing insurance policy or starting out on a new one (for which it seems likely my wife would be refused cover based on her health history).

Thanks
 
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You don't have to keep your insurer updated. However, you will have to disclose it if getting a new policy. If the insurer refuses to cover your wife, there might still be ways around it so don't panic.
 
Thanks Sunny, good to know. Yes, we'd be completely up-front if we were to start a new policy.

Does anyone know if the tracker-mover products treat the mortgage on the new home as being a brand new mortgage (thereby *potentially* requiring a new mortgage protection policy), or is it the same mortgage just simply transferred to a new house?
 
If possible, check with Irish Life, do not cancel the existing policy even if the original mortgage has to cleared and a brand new one set up. Then if your new mortgage is more than the existing cover your lender can (banks differ on policy on this) if they want allow you sign a waiver to waive your wife's insurance cover based on the fact that she will be unable to get cover or it would be too expensive.

You will then at least have the old policy still in place and will retain the cover left on that for the term left on it.
 
Agree with wbbs, keep your existing policy at all costs, it should be transferable. If the new mortgage is for more or for a longer term, you only have to insure the difference. If that's refused or is too expensive, the lender may accept a waiver for the difference, or a policy covering only you.
 
Tripps;

Policies are not tied into the Mortgage. eg if you paid off the Mortgage you would still retain whatever cover is left on the policy.
 
Tripps

You're fine re the mortgage protection. It is a life cover policy in your name (and your wife). The bank have just taken assignment of the proceeds so they get first dibs in the event of the claim. If you move elsewhere, they release their interest in the policy and the proceeds are paid directly to your estate.

If moving your mortgage, the bank cannot refuse the mortgage if your wife cannot get cover.

Best of luck and I hope your wife recovers.

Steven
www.bluewaterfp.ie
 
Tripps;

Policies are not tied into the Mortgage. eg if you paid off the Mortgage you would still retain whatever cover is left on the policy.


I don't understand this. If the mortgage is paid off, what cover is left on the policy? Does the mortgage protection policy still pay out on death if no mortgage balance exists?
 
I don't understand this. If the mortgage is paid off, what cover is left on the policy? Does the mortgage protection policy still pay out on death if no mortgage balance exists?
Yes. It's just a term life policy where the benefit gradually reduces to zero over a set time.
 
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