Mortgage insurance cover can be taken as protection against a loss of income. You can insure against losing your income as the result of incapacity through suffering an accident, sickness or through unemployment due to redundancy.

You would be able to insure up to a certain amount of the repayment you make each month and this would be pre-agreed at the time of taking out the insurance. This sum of money would then be paid as a tax-free income after you had been unemployed or incapacitated for a period of time and would go a long way towards you being able to keep on top of your repayments.

It is imperative that you are able to keep up the repayments as failure to do so could mean that you would have to give up your home to the lender. The lender would usually allow you to make an agreement to catch up, but without the money coming in to be able to do so they would take you to court and seek repossession. In just a short period of time you could be evicted and have to move out. With a policy to fall back on you would not have this worry.

There are some exclusions that would need checking against your circumstances but if you choose an ethical payment protection specialist such as British Insurance you would be provided with this information. Once having checked these for eligibility you would then be able to apply online and make savings of as much as 40% on the premiums. British Insurance offer 12 months of protection once you have been unemployed or unable to work for a period of at least 30 days. They would also pay back on the protection to the first day of you being unemployed or from being incapacitated.

You can choose to cover against the possibility of losing your income as the result of suffering from an accident, sickness or unemployment together. However you might also want to just take protection against the possibility that you might lose your income due to incapacity alone or unemployment alone. This will go towards determining the cost of the premiums as does age and the amount you insure.

Mortgage insurance cover would be a far better way of protecting the repayments of your mortgage than relying on savings or being applying for State benefits. If you are relying on being able to fall back on State benefits you would have to meet certain criteria and even then you would only get so much money towards the interest part of your mortgage repayment. You would also have to wait for a period of time before you would see any money. If you relied on savings to be able to maintain the repayments then this could also be a let down. You might have to turn to them for many months while you found work again as jobs are not easy to come by, you might also have to take many months away from work while recovering and again savings might not stretch this far.  

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