Should you insure for accident and sickness or accident, sickness and unemployment?

The Mortgage Payment Protection policies we offer gives you the option of insuring yourself for:

  • Disability (that’s accident and sickness)
  • or just unemployment
  • or disability and unemployment

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What is Mortgage Payment Protection Insurance?
Mortgage Payment Protection Insurance pays your monthly mortgage repayment if you were off work due to sickness, accident, or unemployment. (Don’t forget that your home is at risk if you fail to keep up the repayment of loans secured against it.)
How much should you insure for?
The rate you pay is charged per £100 of income you need. So, you should insure for the next £100 above the cost of your monthly mortgage repayment.
How Much Should You Insure For?
For mortgage protection purposes the initial sum insured must always equal the capital sum outstanding on your mortgage. You should also insure yourself for the same number of years that are remaining on your mortgage.
Should you have a “Guaranteed” or a “Reviewable” policy?
A Guaranteed policy is usually better value overall but a Reviewable policy will be cheaper at the outset.
Will you have to pay a fee to your mortgage lender if you don’t buy your Life Insurance through them?
No! By law mortgage lenders are not allowed to charge a fee if you choose to shop elsewhere.
The premiums are very reasonable so as long as you can afford it, and bearing in mind the importance of keeping up your mortgage repayments, it’s best to insure yourself for all eventualities.

Consider the following:

  • Over the last five years illness or accident has caused 28 % of people to have been off work for more than a month.
  • Over the last five years illness or accident has caused 9 % of people to have been off work for more than 3 months.
  • Between the ages of 25 and 34, one in three people have experienced unemployment for more than a month.
  • In the UK 500 people become unemployed each day. 60% of unemployed men and 45% of unemployed women will be out of work for six months or more.
  • The homes of around 80 families are repossessed every day. Most of these repossessions are largely due to unemployment.

Frequently Asked Questions related to the above topic.
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