If you want to ensure that you can continue to make your mortgage repayments in the event of accident, sickness or unemployment then mortgage payment protection insurance – sometimes called MPPI – can help you.
Mortgage insurance protection can help to give you peace of mind but as with any insurance, it will pay to compare mortgage protection quotes before you buy.
The benefits of mortgage protection cover
Mortgage protection cover is designed to pay a monthly sum if you’re unable to work due to accident or sickness or if you have been made redundant.
An MPPI policy typically pays until you return to work or for a fixed period (typically 12 months).
While you can’t normally protect your entire income you can generally cover around 50-60 percent of your salary. This ensures that you benefit from an income while you are off work and that you can continue to make your mortgage payments.
Many a mortgage protection plan will also let you cover your mortgage payment and an additional sum to help with your other household bills if you're not working.
What to look for when you compare mortgage protection quotes
Many people automatically buy a mortgage protection plan from their lender when they take out a mortgage. However, the cost and benefits offered by the leading policies differ wildly and so it can pay to compare mortgage protection quotes before you buy.
You should take the following factors into account:
- The maximum monthly cover that is available – insurers often restrict their MPPI cover to around £1,000 - £2,000 as a maximum and so you should pick a policy that offers the cover you need
- The percentage of your income that can be covered – this varies from around 50 to 60 percent
- The length of time that the policy will pay out (typically 12 months but can be longer)
- The wait period until your first payment is made after you make a claim
When you compare mortgage protection quotes you should also consider the cost of the cover.
However, it is important not to look at price alone as this may mean you get an inferior policy that doesn’t offer the mortgage insurance protection that you need.
Compare quotes for suitable policies and double check the terms and conditions before you take out a policy so that you can be confident you'll be able to claim on your policy should you need to.
