What are the most common optional extras you can have with a Mortgage Life Insurance policy?

There are two - Critical Illness Cover and Waiver of Premium are both worth thinking about.

STEP 1 of 2
Type of cover
Life Insurance       Mortgage Life Insurance
 
Cover Level (£)

Number of years
Do you want:  
Critical illness cover
Family income benefit
 

Hot Topics

Will the Mortgage Payment Protection Insurance pay your interest and capital?
You decide how much you want the insurance to pay out each month if you’re off work. So make sure your cover is sufficient to meet your full monthly repayment to your mortgage provider.
How much should you insure for?
The rate you pay is charged per Ł100 of income you need. So, you should insure for the next Ł100 above the cost of your monthly mortgage repayment.
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.)
You have an Interest Only Mortgage. What sort of Life Insurance do you need?
You need normal, level cover, Life Insurance.
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.
1. Critical Illness cover
If you take out Critical Illness Insurance, then you will receive a tax-free lump sum if you are diagnosed with one of the many serious illnesses listed in your policy. Each Insurance Company has its own list of critical illnesses, but you’ll find a typical list within the related questions shown below.

You’ll also find that it is far more economical to include Critical Illness in a Life Insurance policy than to have two separate policies.

2. Waiver of Premium
Another add-on that’s well worth considering is Waiver of Premium. This is an extra which ensures that the Insurance Company pays your insurance policy’s monthly premium if you were off work as a result of illness or unemployment. This isn’t expensive, and would allow you to keep the policy in what otherwise could be difficult circumstances.

Indexation
In the context of protecting your mortgage, you should not bother with Indexation. This is because the capital you owe your mortgage lender is unaffected by inflation and therefore you do not need to inflation proof it.

Frequently Asked Questions related to the above topic.
Click below if you wish to read them: -