Insurance

 

Payment Protection Insurance

To most people taking out a mortgage is the biggest financial commitment they ever make. There are a number of ways that you can protect your family should you be unable to make the mortgage payments whether this is caused by death or if you lose your job, fall ill or have an accident, and lose your income.

To protect your mortgage against death see our page on Life Insurance where you can choose between level term and decreasing term insurance.

Mortgage Payment Protection Insurance (MPPI) is designed to make the repayments on your mortgage and other related expenditure in the event of Accident, Sickness or Unemployment hitting your income.

In the event of Accident or Sickness or Redundancy occurring for at least a minimum of 30 days, a MPPI policy can provide funds to cover mortgage payments for up to 2 years.

If you will only receive Statutory Sick Pay from your employer, the policy can be set to pay out from the 31 st day of Sickness or Accident. If your employer provides you with good sick pay cover, the time at which you can claim may be extended to 6 months, which can reduce the monthly premium.

If you are an employee, and you were made Redundant you may be eligible for a Redundancy payment in lieu of notice, and for time served. However in the current climate, with the largest companies making large scale redundancies, or going bust, this cannot always be expected or guaranteed, so you may just get the State Redundancy if you have been employed for at least 2 years.

Again, depending on the type of redundancy package you may receive it is possible to adjust the Unemployment Insurance package to reflect the needs you may have. If you were to expect a significant lump sum, you may be able to put a time limit of up to 6 months before receiving a payment for Redundancy on the cover; but if you work for a company where you only expect to receive State Redundancy cover, or no payment whatsoever, you can set the payment period to 31 days.

Most Policies now provide cover for Self Employed, but cover may be limited to paying out if the Business Stops Trading for reasons beyond the control of the Proprietor.

You need to be prepared at the outset to agree how long you will wait before claiming in the event of Accident/Sickness or Redundancy. This is known as the Qualification period. The premiums reduce the longer you wait before claiming. You will also agree at the outset how long you would want the Benefit paid for. This is known as the ‘Benefit Period'.

Accident or Sickness cover can be taken independently of, or jointly with Unemployment cover, or vice versa.

Mortgage Payment Protection Insurance will normally not provide cover for Pre–existing Medical conditions / illnesses. If you are concerned about cover for an existing illness, it is always best to raise the issue with the us so we can confirm with the provider to see if it is possible to cover it.

Nor will Mortgage Payment Protection Insurance provide cover for if you are expecting to be made Redundant, whether formally notified or not. Depending on circumstances, this can even apply if you work for a company which is reported to be in trouble.

State Benefits are limited in the event of Redundancy or Sick Pay, and even the more recently introduced State schemes will only consider stepping in as a last resort, and is dependent on personal circumstances such as Size of Mortgage / Savings etc.

The most the government will pay is your interest…
MPPI covers your full repayment and associated costs.

MPPI can be bought as a stand-alone product from any provider, however due to recent claims, many now have a time limit of it must be taken within 30 days of a mortgage completing. Obtaining cover after this is hard to obtain, and the terms may not be as favorable.

We would be happy to give you a free initial consultation on Mortgage Payment Protection Insurance

Get a quote in minutes from one of our specialist mortgage protection advisors on 0845 458 2633.

For Mortgage Payment Protection Insurance and Buildings and Contents Insurance we usually offer products from a limited panel of providers.

Your property may be repossessed if you do not keep up repayments on your mortgage.

For more information on how we are paid for mortgages please click here.

Grovelawn Financial Services, 3b Restormel Industrial Estate, Liddicoat Road, Lostwithial PL22 0HD — T: 0845 458 2633