WHICH MORTGAGE PROTECTION POLICY?

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Pricing is not directly effected by lifestyle choices such as smoking or excessive drinking. There are however variances between policy conditions. It is therefore essential that you check before taking out a specific policy that your specific requirements are met. Consider the following;

- What term does the mortgage payment protection pay out? A standard insurance package will pay out for a period of between 12-24 months. The longer this period the more expensive the policy. There are however some policies that are much cheaper and these only cover for a 3 month period. This is the time taken for government run policies to kick in. It is important to check if you are covered by government schemes before taking this out as many are not eligible.

- How long before I get a payment? Most insurers will start to pay 1-2 months after the initial problem is reported. The majority of policies will backdate the payments to day one so you receive the full benefit. The reason insurance companies do this is to protect them from having to make a payment if you are out of work just for a couple of weeks. Some companies have a grace period of between 120-180 days before a claim can be made. Check the MPPI exclusions on your terms when signing up.

- How much will they pay? All policies have a maximum amount they will pay out. Usually this is between £1,000 & £2,000. This value does however vary & is linked to the level of cover you take out with your provider. You will usually have to pay on a fixed amount per £100 of cover provided & this can be tailored to your needs.

- Switching Mortgage payment protection policies. Whilst with most insurance products it is worth switching to get a cheaper policy. With MPPI there are usually set exclusion criteria preventing claims within the first 3-6 months. In uncertain times like now it is worth sticking with a product once you have purchased it to make sure you are properly protected. So it is worth shopping round first to find a policy you are happy with before making a purchase.

INCOME PAYMENT PROTECTION

This is another arm of payment protection insurance and should be considered a highly desirable alternative to mortgage payment protection. It is designed to be used as payment of debt should you be unable to work due to illness, accident or unemployment. The major differance is that it is designed to cover your lifestyle rather than a specific debt such as a mortgage. Read do I need A policy to find out if its right for you

- As a rule most policies will pay out if you are off work for over 30 days but this is provider specific. Payment lengths vary depending on the time period you specify when you take out the policy. Typically policies cover between 1-2 years but some will cover you until your retirement age.

- Most cover will provide between 50- 75% of your monthly income but the payments are tax free. This will mean that you should have more than enough cash to pay your mortgage and other financial commitments as well as having money for everyday living.

- Income payment protection gives you flexibility on how to spend your monthly payment and should always be considered before taking out a MPPI policy.

- Loan payment protection provides you with monthly payments in the event of illness, accident or unemployment so that you can cover your financial obligations. It is broad in its type of cover as the money can be used to pay any financial obligation such as a credit card or mortgage etc. Loan payment protection differs slightly from other ASU insurance, as this is more specific and designed to only protect your home.

- All three ASU policies can offer you excellent cover. As such we have included details of their policies in our quote breakdowns found on our QUOTES page.