When it comes to taking out UK mortgage protection insurance then you have to study it very carefully if you want to ensure that it will do the jobs it's intended to do otherwise you could not only waste your money on a policy that is not worth the paper it is written on, but will be putting your home at risk if you cannot afford to meet your monthly mortgage repayments.
When taken out correctly UK mortgage protection insurance can give you a monthly tax free income with which to continue paying your mortgage for up to 12 months and with some providers for up to 24 months. The policy will begin to pay out once you have been out of work usually for a period of at least 30 consecutive days and you can choose to cover against coming out of work due to accident and sickness only, unemployment only or for accident, sickness and unemployment together.
The key facts and exclusions which exist in all policies however mean that a UK mortgage protection insurance policy isn't suitable for everyone. These include some of the most common reasons which keeps people from work such as back problems and stress related illness, which most providers will not cover you for. The exclusions which are also common in policies include only being in part time work, being self-employed, retired or suffering from a pre-existing medical condition at the time or purchasing a policy.
You also have to be aware that the premiums charged for UK mortgage protection insurance also vary greatly from provider to provider and some of the premiums can be extortionate. For this reason it is essential that you get several quotes and so do shop around among the standalone providers who are much cheaper than their high street counterparts.
UK mortgage protection insurance can be a great product and it can do the job it's intended to do but you have to ensure that you read the small print and understand the product you are purchasing before you buy.
They say that an Englishman's home is his castle but in some cases through no fault of your own you could lose everything you have built up around you. If you were to find yourself out of work due to becoming unemployed or after suffering an illness or accident that would keep you from earning a living, you could struggle to pay your mortgage. If you cannot pay your mortgage then you would be at risk of having your lender seek repossession. If you want to safeguard your castle then you need to consider taking out mortgage protection insurance.
Mortgage protection insurance would provide you with the sum you insured against when taking out the policy. You are able to insurance up to a certain amount of your monthly mortgage repayment each month, the exact amount can be found in the terms and conditions of the cover. It is essential to read the small print as you are able to find when the policy would begin to provide an income and for how long it would pay. The terms differ greatly so you have to compare this along with the cost. There are some providers that would allow you to claim on your mortgage payment protection after just 30 days of being unemployed or incapacitated. However some ask that you wait to put in claim until the 90th day. A policy can run with some providers for 12 months, with others you might get 24 monthly payouts.
When taking out mortgage payment protection you can also tailor the policy for your circumstances. For example you might not need to cover against accident, sickness and unemployment together. If you wish to take out cover to insure against unemployment only you are able to do so. If you just want to safeguard against the possibility that you might fall ill or suffer an accident you can take cover for this also.
Mortgage payment protection has in the past suffered from problems along with the rest of the payment protection policies. Problems started for the sector in 2005 when the Office of Fair Trading received a complaint that consumers were getting a poor deal. Following this an investigation began into the sector which resulted in several fines being handed out to well know high street names. The majority of problems lie with high street lenders failing to hand out adequate information at the time of selling cover. Another major problem with taking a policy out alongside the mortgage is the huge cost that is added onto the loan.
High street lenders bring in around ?4 billion each year by selling payment protection which includes mortgage protection insurance. By choosing to take out your policy independently with standalone specialist providers you are able to get a cheaper quote that is age based. The premium would also depend on your age when taking out the cover and the level of protection you wished to take out. Covering your mortgage is essential as you never know what might be around the corner. However it does not have to cost a fortune.
Simon Burgess has sinced written about articles on various topics from Mortgage Insurance, Finances and Income Protection Insurance. Simon Burgess is Managing Director of the award-winning British Insurance, a specialist provider of , loan protection insurance and i. Simon Burgess's top article generates over 74000 views. to your Favourites.