The property market is wild. The cost of living is soaring, and salaries definitely aren’t. Estate agents are relentless, and it will feel like you’ve walked through hundreds of front doors that aren’t quite right before you finally find the place you’ve been looking for.
So, if you’ve managed to find the home of your dreams despite everything, congratulations! This is your first step up the elusive property ladder, and there’s no feeling like having a roof over your head that you can call your own. No more pesky landlords who won’t come fix the leaky shower. No more beige walls that you can’t cover up. No more paying off someone else’s bond!
Remember that feeling of joy, because finding the house of your dreams is only the first step. Real talk: this can be a long and stressful process. You will be asked to sign what feels like thousands of confusing pages, and you will be met with costs that you might not have expected. Some of these costs include lawyer fees, bond registration, transfer costs and moving and maintenance costs. Freaked out yet? Don’t be, compared to how long you’ll likely be enjoying your new home, this part goes by faster than you can say “Let’s paint the walls green!”
There’s only one potentially scary fly in your ointment. It’s this: if you have a home loan and something bad happens to you, you could lose your home. If you can no longer afford to make the bond repayments because you get sick, become disabled, or go to be with Elvis in that big diner in the sky, the bank will sell the property. If that happens, your family might find themselves in a jam.
But there’s a way to avoid this stress: Get life insurance.
It’s pretty simple, but let’s break it down for you, you beautiful first-time homeowner.
How does life insurance protect my family?
Life insurance covers more than just your home loan. It’s used to cover all your outstanding debts so your loved ones aren’t left with any hefty bills to pay if something happens to you (depending on how big your policy is, of course). Basically, if something happens to you and you can’t pay the bond, life insurance pays out a lump-sum to cover the outstanding amount so that your family can stay put and continue to thrive.
Do I have to have life insurance as a homeowner?
Strictly speaking, you don’t, unless the bank or bond originator that’s giving you the home loan requires it. But, if you consider the risk to your family’s financial future if you don’t get covered, it’s strongly advisable that you do.
How much life insurance do I need?
In this case, it’s a good idea to talk to your financial advisor or broker to do a proper needs analysis calculation, but generally the right amount of life insurance is enough to cover your home loan if you die.
Of course, if you don’t already have life insurance to cover your other debts, you probably want to get enough cover to make allowance for that too.
Remember that, because you’re making monthly repayments on your bond, the outstanding bond amount is going to get smaller, so it’s a good idea to adjust your cover each year. This in turn can lower your premiums.
What if I already have life insurance?
It means you’re ahead of the curve, but you should definitely check if your current policy provides enough cover for the extra debt of a home loan. If your cover is too low, you should consider getting extra life insurance to cover that. Remember, the idea here is to avoid leaving your family with unpaid debts.
When should you get it?
If you have dependants and no life insurance, then getting life insurance should be really high up on your list of priorities, regardless of becoming a new homeowner. If you already have life cover, but need to get more to cover your new bond, you should aim to get it before the house is transferred into your name.
Where can you get it?
Well, for one thing, you don’t have to get it from the bank that’s giving you the home loan. You have the option of shopping around, even if you already have life insurance. There are always better deals out there, and that’s where Sanlam Indie comes in.
Sanlam Indie offers a top-notch, no nonsense called Sanlam Indie Life Cover. It’s perfect for you if you’ve got dependants and / or a home loan. And the best part? If you buy any Sanlam Indie policy (Life Insurance, Life Cover, Dread Cover, Funeral Cover, etc.) we’ll match up to 100% of what you pay into a growing Wealth Bonus for you.
So in the long term, we don’t just help you to protect yourself and your dependants, we help you earn back some of those nasty hidden costs with the Sanlam Indie Wealth Bonus, at no additional cost.
But don’t just take our word for it, get a quote and see for yourself 😉