Life Insurance - Terminal Cancer

monkeyman2000

Afternoon, unfortunately my mum has been diagnosed with terminal cancer. She has a joint life insurance policy with me on a property with Bank of Ireland. We have contacted the bank to see if it is possible to pay out life insurance early to make her more comfortable. The bank has says yes but the life insurance will not be paid as a lump sum. Instead it will be used to pay off the mortgage. The life insurance policy is not mortgage protection. Does this sound correct?

Is there anything we can do? We could sell the property but it may take a while to get a buyer.

Damiencm

monkeyman2000 wrote:

Afternoon, unfortunately my mum has been diagnosed with terminal cancer. She has a joint life insurance policy with me on a property with Bank of Ireland. We have contacted the bank to see if it is possible to pay out life insurance early to make her more comfortable. The bank has says yes but the life insurance will not be paid as a lump sum. Instead it will be used to pay off the mortgage. The life insurance policy is not mortgage protection. Does this sound correct?

Are you 100% sure its not mortgage protection?

Either way, if the bank has a charge over the policy then yes it will be paid against the remaining mortgage debt

I definitely would not place the house on the market yet until you are certain about all the details

Sleeper12

If its not mortgage protection then you must have another policy for mortgage protection?

The J Stands for Jay

Sleeper12 wrote: »

If its not mortgage protection then you must have another policy for mortgage protection?

It doesn't have to be a mortgage protection policy for the bank to have taken an assignment over it. When the bank use it to pay off the balance of the mortgage, they will lay the balance to you. Don't forget, the money you would otherwise have been paying to the mortgage each month can be used for something else as the mortgage will be paid off.

monkeyman2000

McGaggs wrote: »

It doesn't have to be a mortgage protection policy for the bank to have taken an assignment over it. When the bank use it to pay off the balance of the mortgage, they will lay the balance to you. Don't forget, the money you would otherwise have been paying to the mortgage each month can be used for something else as the mortgage will be paid off.

Thank you.

Sleeper12

McGaggs wrote:

It doesn't have to be a mortgage protection policy for the bank to have taken an assignment over it. When the bank use it to pay off the balance of the mortgage, they will lay the balance to you. Don't forget, the money you would otherwise have been paying to the mortgage each month can be used for something else as the mortgage will be paid off.

I was trying to find out if there is another mortgage protection policy. If not then this is most likely a protection policy

monkeyman2000

Sleeper12 wrote: »

I was trying to find out if there is another mortgage protection policy. If not then this is most likely a protection policy

No other protection policy in place.

dudara

Moved to Banking & Insurance & Pensions

dudara

The J Stands for Jay

Sleeper12 wrote: »

I was trying to find out if there is another mortgage protection policy. If not then this is most likely a protection policy

A protection policy can still be used by a bank to cover a mortgage.

Sleeper12

McGaggs wrote:

A protection policy can still be used by a bank to cover a mortgage.

I know that. My belief is that op is mistaken and it is a protection policy. This would explain why they want to pay off the mortgage with it. Once it's cashed they will have nothing protecting the mortgage

runawaybishop

Sleeper12 wrote: »

I know that. My belief is that op is mistaken and it is a protection policy. This would explain why they want to pay off the mortgage with it. Once it's cashed they will have nothing protecting the mortgage

Banks often have a declared interest in a life assurance policy and they get first dibs.

Henry Ford III

I've never heard of a joint life policy with a mother and son. It sounds really odd. Is there insurable interest?

If the bank have the policy assigned they can have the claim cheque payable to themselves up to the extent of the debt. That would apply to any form of life policy and not just mortgage protection.

adam88

Op prob has his mom joint on his mortgage or at the very least she’s down as guarantor.

When I was taking now my mortgage I had the option of mortgage protection or life assurance. I’m young and healthy and there wasn’t much in the difference between the prices, the benefit of the life assurance is that the amount available for my family every year will grow and grow.

If it’s mortgsge protection they have then the mortgage will be paid and that’s that, no extra money will be paid, however if it’s life assurance of insurance then the full amount will be paid, the mortgage cleared and the balance given to the family.

Really sorry to hear of your situation, but if it’s any comfort at least your mom will have a settled heart knowing that you’d future is secured in terms of your housing.

Henry Ford III

adam88 wrote: »

Op prob has his mom joint on his mortgage or at the very least she’s down as guarantor....

OP said it's a joint life policy.

p.s. Mortgage protection is a form of term life assurance, just with a reducing sum assured designed to mirror the payback of the loan.

There are all sorts of other variations from level term, convertible term, and even term policies with indexation of premium and benefits to cover inflation risks.

phormium

That's why I presume they have a joint life policy because they are both on the mortgage so that is the insureable interest, one will be at a financial disadvantage if anything happens the other.