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Q & A

Q & A for Mortgage Protection Insurance

The questions and answers below will provide the facts about a Mortgage Protection Insurance Policy

What are the implications of Corona Virus for a Mortgage Protection Insurance Policy?

The coronavirus is clearly a very dangerous virus and it has implications for buying a Mortgage Protection Insurance Policy.  Insurance proposals will now include a questionnaire relating to the virus.

A sample of the questions likely to be asked is set out below.

  1.   Have you tested positive for CV-19?
  2.   Within the last 30 days, have you
  • Experienced symptoms of a new or unexplained continuous cough? Have you experienced a high temperature or fever, breathing difficulties, or any other symptoms of CV-19?
  • Been self-isolating due to symptoms of CV-19?
  • Been advised to self-isolate for any other reason?

In addition, it is possible that underlying medical conditions may result in deeper scrutiny by underwriters. Especially if the condition is deemed to make the applicant extremely ill if the virus is contracted.

What is Mortgage Protection Insurance?

Mortgage protection insurance is a life insurance policy designed to pay-off the mortgage in the event of a death.  The Insurance policy activates when the insurer dies, or for a joint mortgage, the first death.

Is there a difference between Mortgage Protection Insurance and Life insurance?

As noted above, a mortgage protection insurance policy constitutes a special form of Life Insurance used when somebody obtains a mortgage.

Mortgage Protection Insurance pays off the outstanding balance on your mortgage. The balance on your mortgage reduces over time and the mortgage protection policy clears the outstanding balance.

The principal difference between a mortgage protection insurance policy and typical term life insurance is that the amount insured does not reduce in a term life insurance policy.  Thus, Mortgage protection policy is cheaper than straight life insurance because the potential payout is less.

However, it is worth noting than in many instances, the difference in price is very small when comparing both types of coverage, especially for young policy holders

Why are banks more expensive for Mortgage Protection Insurance?

Banks provide a range of services to customers including their core product, mortgages.  When they sell a mortgage they  use this opportunity to sell other services, including home insurance and mortgage protection insurance.

Unlike Banks and Mortgage companies, we act as an intermediary and offer advice on the best products and prices from a range of life Insurance companies.

Why do Our Recommendations Receive Accolades

Our Mortgage protection Insurance recommendations are based on years of study and working in the insurance industry.  We evaluate and analyze the price and benefits of Mortgage Protection Insurance Policies.  Our experts only recommend  those that have the best prices and benefits.  We look for discounts and pass them on to our customers.  Our mortgage protection advisers will discuss the merits of many insurance policies  to formulate the best for you.   

Do I need to take out Mortgage Protection Insurance with my mortgage lender?

Absolutely not = you are free to seek independent advice and deal with the best provider. We will always provide better value than the mortgage protection quote you receive from your lender.  Our Mortgage Protection Experts will analyze your needs and search the market to find the lowest priced policy that matches your needs. We then apply a range of discounts to ensure you get the best value.

How do I get a new less expensive Mortgage Protection Policy?

  • Check the level of your existing coverage and how much does it cost?.
  • Compare your current cost with our best offering by using our mortgage protection calculator.
  • We will go through the alternative quotes with you.
  • We will arrange for the completion of the paperwork and issue of your new less expensive policy.
  • Only cancel your existing policy after the issuance of the new policy.

What happens if I stop paying my Mortgage Protection Policy?

Please never stop paying your mortgage protection policy.

It is a specific condition of your mortgage and you will be in breach of your mortgage agreement if you let the policy lapse. If you are having difficulties meeting your mortgage protection payment, you should advise your lender as soon as possible.

The main reason for continuing to pay your mortgage protection is that if you die and the policy has lapsed, your dependents may not be in a position to afford the mortgage repayments and they could lose the family home

How much does Mortgage Protection Insurance cost?

The good news is that mortgage protection insurance is surprisingly inexpensive, principally because the balance reduces over the term (in line with your mortgage), and more importantly the risk of dying during the mortgage term is low.

What Insurance will I need when taking out a mortgage?

The two essential insurances are:

  1. Mortgage protection Insurance or life Insurance policy for the total amount of the mortgage for a period at least equal to the mortgage.
  2. Home Insurance to protect your house against fire and other perils.

Popular additional Insurance

  1. Income protection insurance. This form of insurance pays out up to 75% of your income in the event you are unable to work due to illness or injury.
  2. Serious illness insurance. This insurance covers serious illnesses like cancer, heart attack, or stroke and the coverage can be set up to pay off your mortgage in full if you, unfortunately, contract one of these illnesses or other serious illnesses. The actual illnesses that qualify for a payout are specified in the insurance policy.

Are all Mortgage Protection Policies the same?

All mortgage protection policies are not the same. The key and most important feature of mortgage protection policies is that the policy will pay off your mortgage, on acceptance of a valid claim, typically evidenced by a death certificate.  There are a range of features in these policies that differ from company to company, some of these features are free and others involve an increased premium.