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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.
Is Mortgage Payment Protection Insurance the same as a Mortgage Insurance Guarantee?
No. Mortgage Payment Protection Insurance is totally different to a Mortgage Insurance Guarantee.
You have an Interest Only Mortgage. What sort of Life Insurance do you need?
You need normal, level cover, Life Insurance.
Should I include Terminal Illness Insurance?
Terminal Illness Insurance is generally included at no extra cost on all Mortgage Life, Life and Critical Illness policies.
Will your mortgage lender accept a Life Insurance policy bought online?
All your mortgage lender will want is evidence that your life is insured for the correct sum and term. A copy of your Acceptance letter will normally suffice but some lenders may want to see a copy of your policy.

You have a Repayment Mortgage. What sort of Life Insurance do you need?

You need Mortgage Life Insurance.

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
 

Mortgage Life Insurance makes sure that the capital outstanding on your repayment mortgage would be repaid if you died.

With a repayment mortgage, the amount of cover you need decreases as your mortgage repayments reduce the sum outstanding to your mortgage lender. Therefore, your insurance policy needs to reduce the insurance cover in line with the sum outstanding to you mortgage lender. This is exactly what Mortgage Life Insurance does.

Most Mortgage Life policies include Terminal Illness cover at no extra charge. This means that your Mortgage Life Insurance policy will pay out if you become terminally ill and are not expected to survive more than 12 months. If there is a claim the insurance company pays the money as per your instructions - normally directly to your next of kin or direct to your mortgage lender. This makes sure that the money is there to pay off your mortgage at a most difficult time for you and the family.

If your mortgage is in joint names you should have a Joint policy (most all mortgage providers will insist on this).

For mortgage purposes, the Joint policies we sell are always written on first life. This means that the policy will pay out if either of you were to die or become terminally ill during the policy’s term. (Please note that once a Joint policy has paid out on a first death, the policy is finished – it will not pay out again if the second person were to die.)

Please note that Mortgage Life Insurance policies do not have any investment value. Once the policy comes to the end of its term, that’s it. The policy is terminated.

IMPORTANT:
If you need insurance cover to pay your monthly mortgage payments if you were off work through sickness, accident or unemployment, then you should have Mortgage Payment Protection Insurance.

If you need insurance that repays your outstanding mortgage capital if you became critically ill (as opposed to dieing), you need Critical Illness Insurance.

Frequently Asked Questions related to the above topic.
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