Switched on customers who want to know the truths about mortgage protection UK cover need to have the facts at their fingertips about what the cover can do to help them through a difficult personal and financial period of their lives.
Mortgage protection is an insurance policy that covers the cost of a homeowner’s mortgage repayment if they are made redundant or cannot work because of sickness or injury.
The big question is – if you have a policy can you make a claim or is the money you are paying in to the policy as a monthly premium just a waste?
To find this out, you can drill down in to some statistics buried deep on the Association of British Insurance (ABI) web site for a spreadsheet of lending and mortgage protection data that is updated every six months with the help of the Council of Mortgage Lenders.
This means the data covers just about every major insurance provider and mortgage lender in the UK. The number crunching by the ABI/CML busts three mortgage protection UK myths:
MYTH: If I claim I won’t get any money
According to the data, about 2 million mortgage protection policies were in force. Providers recorded 28,700 claims in the six month period and accepted 88% of them (25,256).
MYTH: No one is sick or injured long enough to make a claim
The average number of days a homeowner was off work due to sickness or injury when a claim paid out was 169 days – which is more than five months.
MYTH: No one made redundant has a claim paid
Again, the average number of days a homeowner was off work after redundancy was 168 days – again just over five months
What mortgage protection UK cover meant to these 25,000 people was that during in a time of hardship and stress, they had one less problem to worry about because their insurance looked after their mortgage repayments.
Most mortgage lenders offer protection when you take out a new mortgage, remortgage or take a second or secured loan.
A mortgage protection UK policy is optional. Borrowers do not have to have any mortgage protection and if they decide that it might be a good idea for them, they can shop around and compare several different products.
Consider these four factors when buying mortgage protection insurance:
1. Think about if you would need cover to help with mortgage repayments if you lost your job or could not work.
2. Look for the best policy that suits your needs – not just the cheapest and most easily available.
3. Consider the level of cover required. If you have a partner who works, you may not need as much cover as someone who is single or the sole breadwinner.
4. Understand the policy’s terms so you know what the insurance covers, and what it does not cover.
With these facts, you should find it simpler to find your way round the maze of mortgage protection UK cover.
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