Mortgage protection insurance is a type of policy that can save you from losing your home. If you lost all or part of you salaried income how would you continue to meet your monthly expenses. If you have savings, then that is great but if you don’t have any other income you might want to get a protection policy.
You probably saved for years or borrowed to make the deposit on your home. You would have had to prove your income or self certify a certain amount. Now that you have a mortgage it is even more important to make sure your have a regular income.
The mortgage protection insurance will pay a monthly tax free benefit if you lost your job under involuntary circumstances or if you had to take time off work due to an accident or illness.
Once the payments begin, they will last for a maximum period of 12 or 24 months depending on the provider you choose. If you were to return to work within the maximum period then payments will stop.
The other great benefit of this policy is the peace of mind it provides. With the benefit from the policy you can keep your mortgage payments up do date so there is no need to worry about missed payments or even repossessions.
The policy gives you enough time to seek viable alternative employment without the stress and worry.
To apply for a policy you will need to prove your last six months employment history and meet the entry requirements. It is important to read the terms and conditions well taking note of any exclusion that exists. Make sure the policy is a match to your circumstances.
The last thing you want is to be stuck with a policy that will not pay out due to some information in the small print.
Things To Note
Providers have maximum levels attached to these policies so the most you will received as a benefit is a percentage of your gross salary. It is up to you to choose a policy that pays enough to cover your mortgage payment.
When making a claim providers will require a set period of unemployment before you can submit a claim. This is known the deferment period and can be between 30 – 90 days.
Although there are many providers of mortgage protection insurance, making a decision can be easy if you use the cost of premiums as the deciding factor. If you obtain quotes from independent providers, you’ll see that the cost of premiums is much lower than the products of high street companies.
You may be ale to take out coverage for only one or two of the named qualifying events. Depending on the combination you choose, this could alter your premiums.
Summary
Hopefully you have a better understanding of the ins and outs of mortgage protection insurance. If you remember only one thing, remember that the policy will provide you with a financial benefit when you need it most and this could save you from losing your home.
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