Interest rates are on the rise…. What insurance should I have?
If you are a homeowner, then it’s likely you have either experienced, or are about to experience, a hike in the amount you spend monthly on your mortgage.
This time last year the average interest rate was 2.29%, now it is around 3.9% (however this can vary from lender to lender). This is a huge increase and adds a significant amount onto repayments per month.
With all the changes happening in the lending space lately, it’s a good idea to take a look at whether your insurance is still meeting your needs.
Mortgage protection insurance has a built-in margin of 10-15% of your mortgage repayments to account for interest rate movements, however with how drastically rates have shot up over such a small amount of time, you may find that you are short of protection. If you took out mortgage protection insurance last year and have refinanced recently, you may wish to consider reviewing your insurance to ensure your full mortgage repayment is still covered. Otherwise you may find yourself having to top it up, should something happen.
A good rule of thumb is that every time you re-fix your mortgage, also take a look at your insurance policies to ensure they are still at the level of cover you need.
Loan Market makes it easy with our sister company Insurance Market covering all of your insurance requirements. Our local insurance advisor, Allanah, is based out of our Queenstown office and can help with a range of insurance products.
Call us today on 03 441 1307, or find other ways to contact us online here.