Life Life Assurance - How much needed

M

mrssummer

Guest
I am looking for some advice & am hoping somebody can help me. I am looking into changing my life assurance, have looked at other posts here but still very confused!!

We are a couple in our early 30's with mortgage of €172,000, 22 years left. have one ds and another baby on the way. No other debts. We took out life assurance and critical illness when we took out our mortgage in 2007. TBH didn't look into it at all (different times), just went by mortgage provider's advise. We currently are insured for €190,000 critical illness each and have €190,000 each dual life convertible and indexed. Premiums are about €130 per month and tbh we can't afford to pay this much!!

I have decided to cancel critical illness policy but not sure how much life assurance we should have. Was thinking maybe €400k dual, no conversion or inflation. What do ye think? Does that sound enough? How should we calculate this. Also looked at some websites offering 70% of the first year, is there any clause to this?

Thanks
 
Firstly, you should take out a separate mortgage protection policy of €172,000 over 22 years. This will be assigned to your lender.

Life insurance is there to replace income lost on death so the amount you need will be based on your income(s) and how long you have to retirement. Is €400k just an out of the air figure? There is no exactly correct figure but a financial advisor will be able to go through your needs and explain how much you should have.

I don't think there is any clause to the discounted insurance but as it is done on an execution only basis, no advice is given - you decide amount, term, type of insurance and insurer.
 
Thanks Norfbank,

So should we have mortgage protection on top of life assurance. Never knew this!. The 400k was only an estimate tbh, thought if pay mortgage out of this would have circa €200k left over and 2 kids, hopefully other spouse would still be working so should be enough!! So if we get seperate mortgage protection to cover mortgage and life assurance, we would reduce life assurance amt. It's all v confusing!!
 
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