Mortgage Protection Insurance
Mortgage protection insurance is designed to relieve the financial worries of paying off the mortgage should somebody die. A mortgage protection insurance policy is designed to pay off the mortgage if the policy holder dies within a set period of time (this is agreed between the insurance provider and the policy holder). Mortgage protection insurance is also known as mortgage decreasing life term assurance as the sum paid out diminishes over time, which happens because the mortgage will decrease as you pay it off.
Who can benefit from mortgage protection insurance?
If you have a mortgage and you worry that your partner would struggle financially should you pass away, mortgage protection insurance would be beneficial. The policy would ensure that your spouse or partner did not have to be concerned about keeping up with mortgage payments, as well as dealing with the trauma of losing a loved one. If you already have an endowment mortgage policy, you should be covered by this and should not need an additional policy to cover your mortgage.
It is essential to recognise the difference between policies, as there exists a number of comparable policies. Mortgage protection insurance or assurance should not be confused with mortgage payment protection, as this covers mortgage payments in case the policy holder become seriously ill or suffers a serious accident, rather than covering death. Mortgage protection insurance should also not be confused with level term life insurance, which provides a lump figure payment if the policy holder dies inside a static period of time.
Is it essential to have mortgage protection insurance?
Most mortgage providers will tell you that it is essential to have insurance when you take out a policy and, in most cases, it is useful. However, you are entitled to shop around for policies and you do not have to take the first offer; shopping around could save you a lot of money.
How much does it cost?
The price of the premium depends on several factors relating to the individual and their mortgage. If you have a high danger of dying (if you are older or you have a poor medical history, for example), your premium will be higher and the price will also reflect the term you select and the size of the mortgage.
Life Insurance
- Life Insurance - Intro
- Why should I consider buying critical illness cover?
- Which illnesses are covered?
- How do I compare critical illness cover policies?
- What is the cost of critical illness cover?
- Can I increase my cover after the policy starts?
- How do I make a claim?
- What is level term life insurance?
- What is mortgage protection insurance?
- What are critical illness policies?
- Will any exclusions apply to the critical illness cover?
- What types of critical illness policy are available?
- Who can take out critical illness cover?
- How do I apply for critical illness cover?
- What should I do if I want to complain?