FNB mortgage protection plan.

marhsava

marhsava

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Is it mandatory or not?

Can't you taking a life insurance from a third party instead ?
 
marhsava said:
Is it mandatory or not?

Can't you taking a life insurance from a third party instead ?
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Have a bond with FNB - I have life insurance separately, and they accepted that. You have to prove that your life insurance will cover it though.
 
GhostSixFour said:
Have a bond with FNB - I have life insurance separately, and they accepted that. You have to prove that your life insurance will cover it though.
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Do you also have to get a policy for disability , income protester, etc.

Feel like fnb is shoving there product down my throat.
 
I've been using that house insurance for 10yrs - didn't find cheaper alternative, but I didn't try too hard.
I think u do need a life policy, it may be optional, but then your risk profile is a lot worse right.
 
It's mandatory for certain values of home.

But not mandatory to take from them no.

Less hassle though as you don't need to prove it annually.
 
Life insurance is no longer mandatory on a bond , depends on the bank but to my knowledge the NCA removed that requirement.
 
Kosmik said:
Life insurance is no longer mandatory on a bond , depends on the bank but to my knowledge the NCA removed that requirement.
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Can't see that being true, but it seems it was more about controlling what can be charged and how much : https://www.businesslive.co.za/bd/n...-insurance-rules-beef-up-consumer-protection/

(edit)
"The final regulations set a monthly credit insurance limit of R4.50 for each R1,000 owed on all credit agreements except mortgages. Ordinary mortgage agreements have a R2 limit for each R1,000 owed. In practical terms, a mortgage agreement of R700,000 should carry a maximum monthly credit life insurance premium of R1,400."

I pay R350 for R700K bond. I also nearly died in the first year of my bond and one of my wife's concerns when she did not know if I would make it through the night was the financial stress of her sitting with the bond. My wife did not know I had life insurance on the bond. Not worth not having insurance even if you could opt-out.


@OP check their T&C's https://www.fnb.co.za/home-loans/life-assurance.html

"You are however entitled to provide your own policy to be ceded to the Bank, subject to the policy having sufficient cover to pay off the outstanding balance, or registered bond amount, at the time of cession."
 
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Got a quote from discovery life of a cover for 1.2 mill for R200 a month , taking that instead of the fnb product.
 
marhsava said:
Got a quote from discovery life of a cover for 1.2 mill for R200 a month , taking that instead of the fnb product.
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Keep in mind you need:

* Life insurance
* Building insurance

The life insurance is easy as you don't increase the cover with time so you can easily budget, the building insurance needs to be reviewed religiously and this will increase with building costs. My house replacement cost went from R1.1m to R1.3m in value in the last five years but it could actually be more. That is the house, not the property. I pay R340 pm which gets reviewed every few years.
 
cbrunsdonza said:
Keep in mind you need:

* Life insurance
* Building insurance

The life insurance is easy as you don't increase the cover with time so you can easily budget, the building insurance needs to be reviewed religiously and this will increase with building costs. My house replacement cost went from R1.1m to R1.3m in value in the last five years but it could actually be more. That is the house, not the property. I pay R340 pm which gets reviewed every few years.
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It's a sectional title unit so won't be taking building insurance, will be covered by the body corporate fee
 
marhsava said:
Is it mandatory or not?

Can't you taking a life insurance from a third party instead ?
Click to expand...

Do you have retirement funding with your employer? If so, there is usually life and disability assurance included. Check whether this would cover the bond balance.

Just bear in mind that, if you use this option, you would not be covered should you lose your job, or you would need to check should you change jobs,
 
I have a fairly new bond with FNB, they offered me their Life cover which in my opinion was way too much.

I took a Life cover with Liberty Life just to cover the amount of the bond, which was quite a reasonable amount compared to FNB cover.

The best part is the Liberty Life cover does not fall away after paying off the bond whereas the FNB cover falls away after paying the bond or moving the bond to another bank for any reason.
 
marhsava said:
Do you also have to get a policy for disability , income protester, etc.

Feel like fnb is shoving there product down my throat.
Click to expand...

Don't know. They never asked for proof of that, but I do have all of that on the same policy anyway, so maybe they got the answer they wanted.
 
cbrunsdonza said:
Can't see that being true, but it seems it was more about controlling what can be charged and how much : https://www.businesslive.co.za/bd/n...-insurance-rules-beef-up-consumer-protection/

(edit)
"The final regulations set a monthly credit insurance limit of R4.50 for each R1,000 owed on all credit agreements except mortgages. Ordinary mortgage agreements have a R2 limit for each R1,000 owed. In practical terms, a mortgage agreement of R700,000 should carry a maximum monthly credit life insurance premium of R1,400."

I pay R350 for R700K bond. I also nearly died in the first year of my bond and one of my wife's concerns when she did not know if I would make it through the night was the financial stress of her sitting with the bond. My wife did not know I had life insurance on the bond. Not worth not having insurance even if you could opt-out.


@OP check their T&C's https://www.fnb.co.za/home-loans/life-assurance.html

"You are however entitled to provide your own policy to be ceded to the Bank, subject to the policy having sufficient cover to pay off the outstanding balance, or registered bond amount, at the time of cession."
Click to expand...

My third party insurance would've paid out the coverage at that point. So you would've come out of the hospital, with no home loan debt. Pay about the same...

*depending on what happened. Talking about heart attacks/strokes/cancer and the likes.
 
So FNB called today , I told them I already got a life policy in place , they was fine with it but didn't even ask me to send any proof that I do , so let's wait and see.
 
GhostSixFour said:
My third party insurance would've paid out the coverage at that point. So you would've come out of the hospital, with no home loan debt. Pay about the same...

*depending on what happened. Talking about heart attacks/strokes/cancer and the likes.
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My condition does not fall under dread disease, did check, as it diagnosed as an acute incident and not chronic even though it happened twice in two years.
 
marhsava said:
So FNB called today , I told them I already got a life policy in place , they was fine with it but didn't even ask me to send any proof that I do , so let's wait and see.
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They will require proof at some stage. Checked my email history yesterday and saw they requested proof of my cover weeks after my bond approval.
 
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