What does mortgage payment protection insurance cover?
Your mortgage payment protection insurance will depend on your policy details. Generally, it may provide you with an income in the event of:
- Accident or illness – If a serious accident (such as a traffic accident or fall) or illness stops you from working
- Redundancy or unemployment – If you are made redundant through no fault of your own (for example, if your employer goes into liquidation).
Some policies will cover you for either accident and illness or redundancy, but not both. Other mortgage insurance policies may cover you for both eventualities, but you may pay a higher premium for these more comprehensive MPPIs.
What isn't covered
There are certain situations that your mortgage insurance policy will not cover you for, including:
- Voluntary redundancy
- Being dismissed from your job for misconduct
- Some pre-existing medical conditions
- Self-inflicted injuries
Your Park Insurance broker will be able to explain to you the details of what is and isn’t covered in your policy.
What affects the cost of a mortgage payment protection policy?
A number of factors can affect the cost of your mortgage payment protection policy. These include:
- The level of cover – Policies that cover accident and sickness as well as unemployment may cost more than policies that cover only accident and sickness or exclusively cover unemployment
- The monthly benefit amount – Higher monthly benefit payments may result in higher premiums
- The length of the deferred period – If you choose a 30-day deferral, you may find that the premiums are higher than policies with longer deferred periods of 60 days or more.
- Your age – If you’re older, you may encounter higher premium rates due to the increased perceived risk of illness
- Employment type and job risk level – If you are in full-time employment, your policy may be more competitively priced than for someone in temporary or contract employment, depending on the insurer’s criteria. Manual or hazardous occupations may also result in a higher premium
What's the difference between mortgage protection insurance and life insurance?
The key difference between the two is that mortgage payment protection insurance provides short term cover so you can keep up with your mortgage repayments, whereas life insurance is long term cover that allows your next of kin to repay the mortgage if you die.
Will my job affect my mortgage payment insurance?
It can. Jobs considered higher risk, such as manual work, farming, construction, and some trades, are often more hazardous, as they carry a greater risk of accidents, such as falls, trips, and slips. Office jobs are considered safer and, therefore, may result in a lower premium rate.
Cover your mortgage repayments with Park Insurance
Park Insurance has been a specialist insurance brokerage for over 30 years. With experts who are fully qualified and regulated, the advice you receive is accurate, up to date, and impartial. Our position as a preferred broker for some of the UK's largest insurance providers enables us to access competitively priced deals and create bespoke insurance portfolios tailored to your specific needs and budget.
To find out more about mortgage repayment insurance, simply call us direct and talk to one of our advisers for a no-obligation free quote today.