Blog – Galway Talks – 04.04.2013

Question:  I own an investment property and I am in the process of renegotiating the terms of my mortgage with the lender.  I did not have any life cover attached to this loan previously and they are now insisting that I take out a policy.  Can they do this?

Answer: If you are renegotiating the terms of your loan, then the lender will apply new conditions. On this occasion they are insisting on life cover and if you are to accept the terms of a new loan then it will be necessary for you to take out a mortgage protection policy.  Obviously the cost of this cover will be dependant on your age and health circumstances.

Question:  Is it possible to move my pension plan from one life company to another as I am unhappy with the provider that I am with at present?

Answer: It is possible to move your pension from one fund to another with the life company that you are currently with.  What most people do not realize is that you can also move between life companies.  This can be important, as there may be a far more suitable and attractive fund for your pension with another provider.  I would always urge people with a pension, to review how those monies are invested every 5 years and make changes as necessary.

Question:  Both my husband and myself bought properties separately before we were married.  One of these houses is now our family home.  We are both in our 40’s and have mortgage protection policies against each loan.  Would it be advisable to take out joint cover?

Answer:  Joint cover would provide extra protection for you as a policy would pay out on the first death.  Obviously there would be an extra cost involved and you will have to decide if this is worth the extra outlay compared to your current position.

Question:  I have an investment that recently matured with a Capital Guarantee on it that I took out 5 years ago.  I only got back the original investment amount and made no gain on it.  I am very disappointed at the performance and I am wondering what your comments would be on this?

Answer:  When an investor takes out a bond with a Capital Guarantee attached, they are making a very distinct statement which is that they are looking for security for their monies.  As we all know the last 5 years have been particularly turbulent on investment markets and if you did not have a Capital Guarantee, then depending on what alternative risk orientated fund you were invested in, you could be looking at a loss of up to 25%.

It is very disappointing not to receive any return, but I would provide you with comfort by saying that the capital protection element did what it was expected to do.