I turn 50 in December, and the marketing has already started. Funeral plans, over-50s life cover, “guaranteed acceptance” adverts wedged between the football highlights. I’m still working full time, still running a team, still training for another marathon. The only thing that’s changed is a number, and apparently that number now means I should be thinking about my send-off.
Meanwhile my dad, who’s actually 73, just remortgaged. He’s got a new partner who relies on him financially. Although he had access to willing lenders, he doesn’t remember protection being discussed during the process, nor any life cover linked to the new borrowing, or a conversation about what might happen to his partner if he died before the mortgage was repaid.
He got a mortgage rate, but it appears the wider financial consequences for those who depend on him weren’t explored.
So somehow, I’m the one receiving funeral plan advertising at 49, while my dad, at a genuine later-life age, taking on genuine later-life risks, completed his remortgage without protection being raised with him.
It is only one family’s experience, but it illustrates a potential mismatch between where later-life products are marketed and where meaningful protection conversations may be needed.
And it’s not a fringe story. Later-life lending was up 13.4% in the last quarter alone, worth £6.2 billion. This is one of the fastest-growing corners of the mortgage market, and the growth is exactly why the gap in my dad’s case matters. More people are doing what he just did.
SO WHY ISN’T ANYONE ASKING?
Emad Aladhal, the FCA’s director of retail banking, told the Later-Life Lending Summit in June that the market runs in silos: mortgages, pensions, investments, and later life planning all “playing different parts of the pitch,” with advisers not always looking at the whole journey.
Mainstream brokers may discuss protection alongside a standard mortgage, but advice on equity release or retirement interest only (RIO) mortgages require the appropriate permissions and expertise.
Specialist later-life advisers may focus primarily on property and lending needs, so unless responsibilities are clear, there is a risk that each party assumes someone else has considered protection.
The products may not always provide a straightforward fit either. With a lifetime mortgage the interest can roll up and increase the amount owed, so a standard decreasing term policy may not track the borrowing over time. Cover designed to reflect a growing balance could become expensive for someone in their 70s or 80s.
A retirement interest-only mortgage may instead create a need for level cover over an uncertain period, potentially until the borrower moves into long-term care or dies. Product availability, eligibility and cost will vary between providers and according to individual circumstances.
Even if protection had been raised with my dad, an affordable option may not have been available, but that is different from the question never being explored.
Here’s the bit that stopped me. The FCA speech I mentioned was entirely about building later-life lending into the “fourth pillar” of UK retirement, alongside pensions, savings and investments. 10 minutes of it. The word protection doesn’t appear once. If the products genuinely can’t cope with later-life risk, that’s exactly the kind of gap a market study should be naming, not skipping past.
THE GUARANTEE THAT SOLVES THE WRONG PROBLEM
Part of why this issue may receive less attention is the ‘no negative equity guarantee’ that applies to Equity Release Council-standard lifetime mortgages. When the property is sold and the relevant conditions are met, the borrower or their estate will not have to repay more than the property’s sale proceeds.
It’s a valuable guarantee for the borrower and their estate. But it protects the value left in the property, not the person left standing in it. It does nothing for a partner who suddenly can’t cover the bills, or who has to sell up because the household income died with the borrower. We’ve quietly let “the house is safe” stand in for “the family is safe,” and they’re not the same thing.
IT’S NOT JUST ABOUT PASSING AWAY
The health point matters just as much, and it’s tangled up with how retirement income itself has changed. My dad’s income today isn’t a fixed pension- it’s a mix of things, some flexible, some still earned. Traditional income protection is built around a full-time salary and a working-age applicant, which makes it almost useless for this group, quite apart from critical illness cover becoming unaffordable or unavailable much past 70.
So, what might improve the position? Rather than relying on a single new product, mainstream brokers could ask if the later-life specialist considered protection, and later-life specialists in turn need to consider if the mortgage adviser has done so.
Insurers could help too. Capped, shorter-term cover that does not try to match the whole rolled-up debt would still give a partner breathing room without pricing everyone out, although suitability, availability and cost will depend on individual circumstances.
And the no negative equity guarantee while valuable, should not be treated as if it does more than protect the value left in the house.
I don’t need a funeral plan. I need the industry to stop assuming 50 is the finish line and start noticing where the actual risk sits. My dad didn’t need another five minutes of paperwork on his remortgage.
What he needed was one person, anywhere in that process, to ask what happens to the people who depend on him, if he doesn’t get to enjoy the house he just borrowed more money against. Nobody did. That’s the gap.
