Mortgage protection cover is a short-term insurance product gaining in popularity in the UK, especially in today's current unstable economic climate. The insurance typically has payout plans that provide monthly income payments based on income and mortgage amounts. These payout plans generally run from 12 to 24 months. While there are some opportunities buy plans for longer protection, it is usually more economical to go with other insurance products based on the increased premiums for longer terms.



Mortgage protection cover is designed to provide protection for full time employed people concerned about paying their monthly mortgage in the event of involuntary redundancy, illness, accident. Plans can be purchased with one, two, or multiple covered events. Obviously, the more events that an individual has covered, the higher the premium cost becomes. However, by working with an insurance broker, most individuals can find affordable plans to cover all available job loss events.

Allowable coverage amounts vary, but consumers can usually find plans that cover full mortgage payments, plus some allowable monthly expenses. Some providers base the coverage amount available on monthly income. Mortgage protection usually has a higher allowable coverage than other payment protection insurances, with many providers allowing coverage up to 65 per cent or so of monthly income.

Mortgage protection cover is gaining in popularity as more consumers become aware of the insurance. Concern about controversial selling practices used by high street banks and large lenders has also lead to greater awareness and increased education of consumers. The Competition Commission will announce results of its current investigation into the payment protection insurance (PPI) industry, in February of 2009. Their investigation was driven by consumer advocate groups who expressed anger over mis-selling practices.

Large institutions have developed a reputation for selling products to ineligible patrons, such as retirees and part time employees. They have also regularly packaged the insurance with mortgages, credit cards, and other loan products in order to pressure consumers into paying high premiums for the protection. Some have even failed to directly communicate to customers that they were even paying for the insurance, instead using fine print to convey the message.

The good news is that insurance premiums are available at 40 to 80 per cent of standard bank premiums. Insurance brokers not only offer lower premiums, but they also maintain a better reputation for fair selling practices. Many brokers are members of organizations or associations that enforce regulations or policies to protect member customers. Brokers are also usually knowledgeable about their products and happy to help customers find the right products at the right rates.

Since October of 1995, the State has not provided assistance for unemployment or disability for the first nine months an individual was out of work. For many Brits, this is enough time to lose their homes or risk their family's financial well-being. Citizens must take control of their own financial situation and may want to look to some form of low cost mortgage protection cover to protect their homes.