Life5 Mortgage: the life insurance for my home.

You decide when you leave, instantly, without paperwork or explanation. The main purpose of life insurance is to protect your family members in the event of your death. Securing your family's future will always be the right choice. If you have people who depend on you for their livelihood, life insurance will be the financial support they will need if you are no longer around to provide it.

At Life5 we aim to ensure that everyone gets the protection they really need, with a life insurance policy that suits their needs. An insurance policy that you can take out 100% online in just a few minutes. It will only be necessary to answer a short questionnaire. No medical exams or commercials - instantly insured!

While this is the main reason to buy risk life insurance, there are more benefits it can also provide.

No, under no circumstances is it compulsory for you to take out a life insurance policy in order to sign a mortgage. No bank can impose the contracting of a life insurance policy with them in order to obtain your mortgage loan. It is true that they can and usually do offer bonuses, i.e. better conditions for your mortgage for taking out a life insurance policy.

You should consider all possible options and make a comparison to see which is the best solution for you. Currently, in the Spanish insurance market, the price of life insurance offered by banks tends to be much more expensive than those offered by insurance companies, and can be as much as double the price.

Here we must point out the importance of doing all the calculations well, paying attention to the conditions that the entity and the different insurance companies offer you. Make sure you are taking out the cover you really need and choose the option that suits you best.

The Life5 policy is annually renewable, which means that it will be updated and renewed from year to year. Normally, when you take out the policy with the entity that offers you the loan, the duration of the insurance is equal to the years that the mortgage lasts. In such cases, it is possible to shorten the duration, but it would not be possible to lengthen it.

With Life5 the situation is different. If you consider that you still need life insurance when you have paid off your debt with the bank, you can renew it, as long as the maximum age allows you to do so. Thus, the duration of the Life5 product will be as long as you consider, because if you decide to cancel it, you can also do so at any time.

When you buy a house with another person, the mortgage, like the house, has two owners. However, the life insurance cannot be the same for both, a life insurance policy must be taken out for each of the signatories of the mortgage.

Keep in mind that this product is taken out to support your family financially if something happens to you and not to leave them with large financial burdens such as the mortgage loan.

Ideally, when taking out two life insurance policies, both should cover the entire loan, so that if something happens to one of the policyholders, the other would not have any difficulty in paying the mortgage. Most commonly, however, they each take out equity equal to half of the debt. This way, even if the debt is not paid off with the single-owner policy, it will be easier for the couple to pay off the full amount

One of the reasons why a life insurance policy cannot have more than one policyholder, in addition to the fact that this product insures the life of one person, is that the price of the policy depends on the situation of the insured. Age, state of health or occupation are decisive factors in calculating the premium.

As we have already mentioned, mortgage life insurance is not compulsory in any case, but it is a highly recommended solution, especially if you are the main income earner and you have dependants.

For this reason, as it is a voluntary product, the duration of the policy will be as long as the insured considers necessary. It is recommended that it has the same duration as the mortgage. However, if, after having paid a large amount to the financial institution, you consider that the other owner or heir of the property could take over the remaining debt without any problem, it is possible to take out insurance for fewer years.

In the case of Life5, if you no longer need the policy, you can cancel it at any time, as our product has no minimum term. If, on the other hand, you have finished paying the money you owed for the purchase of the house, but you want your loved ones to continue to be protected, with Life5 you can renew your policy for as many years as you wish and, if you wish, you can modify the conditions and coverages.

When a life insurance policy is associated with a mortgage loan, the beneficiary who receives the insured capital contracted is the financial entity that lends the money. In this way, the outstanding debt with the bank is covered and your loved ones can enjoy their home without worrying about paying it off.

Can I choose, in addition to the bank, more beneficiaries for my Life5 policy? That's right. One of the qualities of the product offered by Life5 is that it is an insurance with constant capital. This means that the insured capital contracted will not change even if the debt with the bank is reduced. For this reason, in addition to the bank, you will have to choose one or more beneficiaries who will receive the rest of the compensation.

Normally, when you take out a life insurance policy with the bank, the insured capital is decreasing, as it only covers the payment of the mortgage loan. Thus, as you pay off the outstanding debt, the contracted capital becomes smaller and smaller. In this case, the policy will only have as beneficiary the bank that lent you the money, without the possibility of also adding one or more loved ones.

When you choose several people as beneficiaries of your life insurance policy so that they can receive compensation if something happens to you, the money will be divided equally unless otherwise specified in the contract.

When selecting the people you want to protect and who will receive the insured capital contracted, you can divide it and select a percentage or a specific amount for each of them. For example, if you take out a €200,000 capital contract, you could choose for your partner to receive 50% or €100,000 and for each of your children to receive 25% or €50,000 each.

In the case of mortgage life insurance, the recommended minimum is to cover the full loan repayment. However, if you want to have an addition for your family members to receive, you will need to think about their present and future expenses. The amount of capital to be contracted will depend on the situation and needs of each individual and family. A person who brings the main income to the household or is even the only source of money in the family and who also has, for example, three children, will need more capital than a person whose income is half of the household's earnings and who has no dependants. You need to consider all the variables when thinking about the amount of money you need to insure. You may not have children at the moment, but do you plan to have them in the near future? This changes the situation somewhat, as you will have to think about the costs involved.

If you were offered bonuses for taking out your life insurance associated with the mortgage, it is possible that when you cancel it you will lose these benefits and you will have a penalty in the conditions of your loan. It is also true that some banks will keep the clauses in place despite the cancellation of the policy.

Ask your bank about this and calculate whether or not the mortgage bonus is worth it, bearing in mind that the price of your insurance will go down significantly. To help you with this, there are various calculators on the internet that will do the operations for you and give you the result.

If you wish to calculate it yourself, you will have to carry out two operations, one with one interest rate and the other with the other, the subsidised and the non-subsidised rate. Check how much the monthly cost of your mortgage will be with the subsidised interest rate by adding the price of the linked insurance and then calculate the monthly price with the mortgage without the subsidy. When you check the two results, you are likely to realise that despite the bonus, you are paying more in the end.