Mortgage life insurance calculator
See how a mortgage balance could reduce over time. Results are shown on screen.
About this calculator
With a repayment mortgage, the amount you owe falls over time. Decreasing term cover works in a similar way — the payout reduces over the term, roughly in line with a repayment mortgage.
With an interest-only mortgage, the balance stays the same until the end of the term. Level term cover works in a similar way — the payout stays the same throughout.
The calculator works out your monthly payment and what you would still owe at the start of each year shown. It assumes your interest rate stays the same for the rest of the term and every payment is made on time, with interest added monthly at a twelfth of the yearly rate. For a repayment mortgage the monthly payment is balance × r ÷ (1 − (1 + r)−n), where r is the monthly rate and n the number of monthly payments left. Real balances drift from this when a fixed deal ends, your rate changes or you overpay. Years are rounded to whole years, up to 50.
How much mortgage life insurance do you need?
Mortgage life insurance is ordinary term life insurance set up to pay off your mortgage if you die before it is repaid. To do that, the cover has to match the mortgage in three ways:
- Amount: what you still owe. Your latest mortgage statement or your lender’s app shows the balance.
- Term: the years left on the mortgage, so the cover lasts until the last payment.
- Type: decreasing cover for a repayment mortgage and level cover for an interest-only one.
Some insurers say decreasing cover is not suitable for an interest-only mortgage, because the balance on an interest-only mortgage does not fall. If part of your mortgage is on interest-only and part on repayment, you can cover each part separately, or cover the whole balance with level cover.
For example, a £180,000 repayment mortgage over 25 years at 4.5% costs about £1,000.50 a month. The balance falls slowly at first — after 5 years £158,144 is still owed — and faster towards the end, so decreasing cover keeps most of its value in the early years. With an interest-only mortgage at the same rate you pay £675.00 a month in interest and still owe £180,000 at the end.
| Time from now | Repayment mortgage | Interest-only mortgage |
|---|---|---|
| Today | £180,000 | £180,000 |
| After 5 years | £158,144 | £180,000 |
| After 10 years | £130,785 | £180,000 |
| After 15 years | £96,537 | £180,000 |
| After 20 years | £53,666 | £180,000 |
| After 25 years | £0 | £180,000 |
Mortgage cover only deals with the mortgage. If your family would also need money to live on, or you have other debts, the life insurance calculator adds those up too.
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How much is mortgage life insurance?
The price of mortgage life insurance, often sold as mortgage protection insurance, depends on you as much as on the mortgage. Legal & General, for example, names your age, job, whether you smoke, your health, the amount of cover and the type of cover as the main factors. Decreasing cover is generally cheaper than level cover, because the amount it would pay out falls over the term.
Some insurers publish example prices for decreasing cover. These are their own examples, for the people and dates shown:
| Insurer | Price a month | Cover | Term | Example | Price date |
|---|---|---|---|---|---|
| Assura Protect | £10.00 | £350,000 | 20 years | Single life, decreasing coverAged 35, no medical loadings | 26 May 2023 |
| Beagle Street | Less than £6 | £200,000 | 20 years | Decreasing coverAged 30, non-smoker | Not stated |
| Royal London | £14.38includes a £2.60 monthly plan fee | £260,000 | 24 years | Joint life first event, decreasing at a 6% interest rate, through an adviserA couple aged 34 and 32, non-smokers | June 2025 |
| Virgin Money | Under £6 | £215,000 | 25 years | Decreasing coverAged 30, has never smoked | January 2026 |
The table is in alphabetical order. Royal London’s example is written around a mortgage: a couple insuring their £260,000 mortgage over 24 years with joint decreasing cover, at £14.38 a month. Some insurers give a starting price instead: Legal & General advertises Decreasing Life Insurance with fixed premiums from £5 a month.
These examples are for people aged 30 to 35, so they are not a guide to your own price. The calculator shows your mortgage balance and the years left; a quote based on your age and health gives the price.
Decreasing cover and your mortgage rate
Decreasing cover does not track your actual mortgage. It falls on a schedule worked out at an interest rate fixed in the policy. Beagle Street models the decreasing cover it sells direct on 6%, Aviva’s Life Insurance Plan uses a fixed 8%, and Zurich Personal Protection, sold through advisers, lets you choose a rate between 2% and 18% a year, at 2% intervals.
If your mortgage rate goes above the rate in your policy, the payout might not pay off the mortgage. The same can happen if you change your mortgage, for example by borrowing more or moving it to a longer term. Nationwide tells customers to check that the rate used for their policy is the same as, or higher than, the rate on their mortgage. A higher policy rate keeps more cover in the early years, so it leaves more room if rates rise.
To see how cover at a particular policy rate falls year by year, and set it against the balances above, use the decreasing life insurance calculator.
Mortgage life insurance is not mortgage payment protection
“Mortgage protection” is used for two different kinds of cover. Mortgage life insurance pays a lump sum if you die during the term (on many policies, also if you are diagnosed with a terminal illness), so the mortgage can be paid off. Mortgage payment protection insurance (MPPI) pays your monthly mortgage payments for a limited time if you are ill or out of work. It does not pay off the mortgage and it does not pay out if you die.
| Feature | Mortgage life insurance | Mortgage payment protection |
|---|---|---|
| Pays out if | You die during the term | You cannot work because of an accident or sickness, or lose your job, depending on the cover you choose |
| What it pays | A lump sum | A monthly amount towards your payments |
| For how long | Once, then the policy ends | Usually for one or two years at most |
| Pays off the mortgage | Yes, if the cover matches what you owe | No |
HMRC describes MPPI as cover for your monthly mortgage payments during illness or unemployment, usually for one or two years at most. These policies are often called accident, sickness and unemployment (ASU) policies, and HMRC says they are not to be confused with mortgage protection life insurance. Citizens Advice adds that MPPI only covers your mortgage payments, that you may have to wait a few months before payments start, and that they usually stop after a set time.
If you want help with the mortgage during a long illness, look at income protection, which pays a monthly income while you cannot work, and critical illness cover, which pays a lump sum if you are diagnosed with a condition listed in the policy.
Joint mortgage life insurance
If you bought with a partner, enter the whole balance: after one borrower dies, a joint debt can still be recovered from the other.
You can cover a joint mortgage with one joint policy or with two single policies. A joint policy is usually cheaper than two single policies, but it only pays out on the first death, while two single policies pay out on each death. After a joint policy pays out, the person left needs a new policy to stay covered.
If you separate, some insurers let you split a joint policy into two single policies. Legal & General offers this on Decreasing Life Insurance after a divorce, the end of a civil partnership, or when a joint mortgage moves into one name.
Remortgaging, moving home or borrowing more
Your life insurance is a separate contract from your mortgage: it pays out on a valid claim during the term whether or not you still have that mortgage. It does not change by itself when you remortgage, move or borrow more, and a policy taken out to pay off your mortgage may not do so unless the cover is adjusted to match the new mortgage. Run the calculator again with the new balance, rate and years left, and compare the result with the cover in your policy schedule.
- Borrowing more or extending the term can leave decreasing cover short of the new balance.
- Some policies let you increase cover without new health questions when you take out a new mortgage. Aviva’s Life Insurance+ calls this its life change benefit.
- If you take out new decreasing cover when you remortgage, Zurich suggests considering a policy rate higher than your current mortgage rate, to allow for future rate changes.
- Free cover while you buy a home does not always apply to a remortgage. Scottish Widows’ Free Mortgage Cover is only for new mortgages. Zurich’s free cover does not apply when you remortgage rather than buy a different home.
If you replace a policy, keep the old one until the new one has started.
Mortgage life insurance questions
It depends on your age, health, whether you smoke, and the amount and term of cover. As one published example, Royal London prices £260,000 of joint decreasing cover over 24 years at £14.38 a month, for a couple aged 34 and 32 who don’t smoke, correct at June 2025. The calculator shows your mortgage balance and the years left, which you can use when you compare quotes.
It depends which kind you mean. Mortgage life insurance, which pays off the mortgage if you die, is priced like other term life insurance: see the published examples above. Mortgage payment protection pays your monthly mortgage payments if you are ill or out of work, usually for one or two years at most, and its price depends on the cover you choose, such as the monthly amount and whether unemployment is included.
It isn’t a legal requirement, but some lenders may make it a condition of lending you the money. MoneyHelper says you might choose it if you want your dependants to have enough money to keep your home when you die.
Decreasing cover follows a repayment mortgage and level cover suits an interest-only mortgage. Level cover costs more, but it pays the same amount throughout, so on a repayment mortgage there would be money left over after the mortgage is paid off.
A decreasing policy might then pay out less than you owe. Check the rate in your quote or policy schedule, and compare its schedule with your mortgage using the decreasing life insurance calculator.
No. You can take out one joint policy or two single policies. A joint policy is usually cheaper, but only pays out on the first death; two single policies pay out on each death.
Nothing changes by itself: the policy is separate from the mortgage. If the new mortgage is bigger, longer or at a higher rate, decreasing cover may not pay it off in full. Run the calculator with the new figures and check them against your policy.
Often, yes, for an extra cost. Legal & General, for example, lets you add Critical Illness Cover when you take out Life Insurance or Decreasing Life Insurance. Critical illness cover pays out if you are diagnosed with one of the conditions listed in the policy during the term.
Sources
The facts on this page come from these sources.
- Nationwide Building Society: Mortgage life insurance (opens in a new tab) · nationwide.co.uk, accessed 26 September 2026.
- GOV.UK: IPTM6105 - Sickness disability and unemployment insurance: types of policies (opens in a new tab) · gov.uk, accessed 26 September 2026.
- Citizens Advice: Illness insurance (opens in a new tab); Dealing with the financial affairs of someone who has died (opens in a new tab) · citizensadvice.org.uk, accessed 26 September 2026.
- MoneyHelper: What is life insurance? (opens in a new tab) · moneyhelper.org.uk, accessed 26 September 2026.
- Barclays: Life insurance for mortgage holders (opens in a new tab) · barclays.co.uk, accessed 26 September 2026.
- Insurer documents: Assura Protect, Aviva, Beagle Street, Legal & General, LV=, Royal London, Sainsbury’s, Scottish Widows, TSB, Virgin Money, Zurich. Each insurer’s policy documents, claims figures and announcements are listed in our review of that insurer.
Related pages
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Mortgage life insurance
Match your cover to your mortgage and protect your home.
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Decreasing term life insurance
The payout falls over the term, often in line with a mortgage.
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Joint life insurance
One policy for two people, compared with two single policies.
