Life How easy is it to replace mortgage protection with life insurance

[Blackrock1]

My wife is leaving the work place, and as we spent some time looking at my insurances and how the family would be in the event of my death, she raised the salient point that if she were to die some insurance could be of benefit to me as a single parent with two dependents trying to work full time.

What i realised was is that we are paying 52 a month for mortgage protection even though our mortage is well below what it was when we took it out.

Its currently 360k and would hope to have it closer to 200k over the next 2 years or so.

If we replaced the mortgage cover with dual life cover of 500k the monthly premium is 68 euro but we will have the benefit of some life insurance on my wife as well as some extra on me as well.

the question is what hoops do i need to jump through to cancel one and put the other in its place?

 

[Monbretia]

Should be no problem provided the new policy covers the term and amount outstanding of the existing mortgage, forward new policy to bank and ask them to send a notification of 'no further interest' to the original life company and then you cancel it with the first company.

Check first with the insurance company if the policy is assigned to the bank and if you need a letter of 'nfi' from the bank. I cancelled a policy recently that was assigned to the bank with my mortgage and the insurance company told me they no longer needed a letter of nfi to cancel and could do it on my written instructions.

Bear in mind though if the new policy is being assigned to the bank the full amount will be paid out to them, now they'll give you back the surplus but maybe not instantly!