Mortgage Payment Protection Insurance

What Is It?

Mortgage Payment Protection Insurance is a policy you can buy to protect you Mortgage Payments should you be made redundant or you need to take time off work through Sickness or an Accident. You can, however, only protect mortgage payments against the property you live in, not any payments against properties you may let out to tenants.

Why Do You Need It?

• At the moment Mortgage Payment Protection Insurance is not compulsory by law but your Mortgage Provider may insist on you taking out a policy.

In today's financial climate, with redundancies increasing month on month, would you be able to make your monthly payments should you become unemployed? High street mortgage providers are advertising at the moment, the fact that they are issuing repossessions of approx 150 properties per day, and actually taking possession of 90 per day.

Most people take out a Life Insurance Policy when they take out a Mortgage so, if the worst happens, the Mortgage can be paid off and your family is protected. Very sensible. But what happens if the worst doesn't happen, what if you are merely involved in an accident or develop an illness and need to take several months off work? Life insurance policies will only payout for a critical or terminal illness, so all of a sudden there is little or no money coming in and bills still have to be paid regardless. Without any income at all your home runs the risk of being re-possessed and you may be made homeless, you will notice this small but very serious statement being printed on almost all of your mortgage literature.

In today's day and age there is no need to leave these things to chance and, seeing as your home is more than likely the biggest and most important investment you will make in your life, it is prudent to protect your home as comprehensively as possible.

Options & Cover Available To You.

The first thing to decide is how much cover you need. There is no need to protect the whole mortgage payment if you don't want to but it is advisable to do so. The most cover you can have is up to 33% more than your monthly mortgage payment. For example, if your monthly mortgage payment is £1,000 you can protect up to £1,333. The extra money can be used to do whatever you wish, most commonly to pay other insurances against the property – for example your Buildings Insurance, and Life Insurance.

Next there are 3 main levels of cover to choose from, so you can choose which one suits your needs best:

• Accident, Sickness and Unemployment, also known as ASU. This is the highest level of cover.
• Accident & Sickness Only. If you are not particularly worried about redundancy then this may be the best option.
• Unemployment Only. This maybe the better option if you receive full and long term sick pay from your employer.

On any policy there is something known as an excess period, which is the number of days you would have to wait before the policy starts to pay. You can choose from 30 days, 60 days or even 180 days. The longer the excess period, the cheaper the policy.

There are other options available to you as well, such as 'Back To Day One Cover' or covering yourself and your partner on a 'Split Level Cover Basis'. If you would like to know more about these then please do not hesitate to free phone one of our experienced advisors on 0800 612 2007. They will be happy to run through and discuss all of the options available to you and find the policy which suits you best.

How Much Does It Cost?

As with everything you buy you tend to get what you pay for. That said the most expensive policy is not always the best so, nor the cheapest the worst, so it is always best to speak to an expert.

For examples purposes only if you were to protect £1,000 per month prices would start from £15.88 per month.

The Next Step.

Simply click on any of the 'Get Quote' icons or call one of our experienced advisors on free phone 0800 612 2007. Let us find the right policy for you.