Homeowners choosing luxuries over insurance - survey

Cash-strapped Irish homeowners feel they can't afford life or critical illness insurance to cover mortgage payments.

Nearly one in three homeowners are thought to be risking their future financial security by not taking out life or critical illness insurance, according to a survey published by the National Irish Bank.

The bank's research raises serious questions about how people would manage to meet their mortgage payment should circumstances change with 62% of respondents indicating that they couldn't cope financially if they were to suddenly lose one source of income.

Figures also reveal that 39% of single people who have bought homes don't have any critical illness cover.

Research also showed that homeowners appeared more willing to use any disposable income on luxury items such as widescreen TV's rather than invest in a mortgage protection plan.

Katherine James, National Irish Bank's General Manager (Personal Financial Services), said: "If a homeowner's budget is currently stretched then they are exactly the kind of person who needs to be thinking about insurance to cover their mortgage payments.

"If something was to happen, how would they cope?" she said.