Accident Sickness And Redundancy Insurance - How Important Is It To Have?
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Mortgage Protection Insurance is one of the most under bought and misunderstood insurances available in the UK. Many people, having been caught out by the hugely expensive payment protection insurance charged alongside personal loans, have shied away from finding out about Mortgage Protection Insurance. Even those who have not been caught out themselves, know someone who has, or have been aware of the campaigns of Which? and other bodies.
Quite simply, Mortgage Protection Insurance, or Accident Sickness and Unemployment cover as it is sometimes called, is designed to pay your mortgage if you can’t. The policy is designed to cover your mortgage payments, normally for up to a year, if you lose your job, or otherwise are unable to work as a result of accident or illness. With the UK entering a recession, having cover in place may be the difference between losing your home or keeping it.
In fact, like any insurance, the price is determined by the level of risk the insurer feels they are being exposed to, and therefore, in times of rising unemployment it seems only logical that the price of such insurance will also increase. Indeed, Norwich Union have recently taken the decision not to underwrite cheaper unemployment only policies, and will only underwrite a combined policy whish includes accident and sickness cover as well.
Policies can be bought direct from your mortgage lender, but many still charge premiums in excess of £5 or £6 per £100 of monthly cover. Whilst this is still far cheaper than typical loan payment protection, it is still expensive when compared to what can be achieved by shopping around.
A good example of this is the Accident, Sickness & Unemployment Insurance that was awarded a “What Mortgage” best buy award in both 2007 and 2008, and frequently tops the Moneyfacts and Defacto best buy tables. The policy charges just £3.95 per £100 of cover, and for applicants who buy online the first three months is FREE.
Like most insurances, there are some who do not benefit, and the self employed in particular should read the small print of policies carefully. Those who have started a job very recently will not be covered for the first few months, but for everyone else the message really has to be “buy now whilst stocks last”.
If you need help in finding Mortgage Protection Insurance? Simply click on one of the mortgage payment protection links above.
Tim Lee – The Mortgage Warehouse
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