Mortgage cover and information

Mortgage protection insurance online

As insurance brokers we aim to help customers needing mortgage protection insurance. You may want mortgage protection against accident and sickness, unemployment or both - and we can offer suitable protection insurance to meet your needs.

Although mortgage protection may be your initial aim, you may want a wider protection insurance. For instance you may require insurance to cover other monthly commitments - such as loans, council tax and utility bills. You can extend your mortgage protection in some cases and protect your other commitments with combined protection insurance cover.

We cannot advise you on mortgage protection on a website as we can't assess your insurance needs. However below we compare the policies that we have available to help you find the appropriate insurance policy.

Please note that for mortgage protection, you must be wanting insurance for your own mortgage i.e. you must be a signatory. In addition you must be in employment, self-employed or a company director for at least 6 months for any of these insurance schemes.

If you currently have mortgage protection and are thinking about changing insurance then, in most cases, we can arrange an exclusion-free transfer. Please note that the new insurance company may not cover existing medical conditions that your current insurer may be covering.

Schemes Available

A comparison of mortgage protection, guide to sums insured and our thoughts on each insurance.

	Mortgage protection for up to £2,000 per month or insurance for 50% of gross income. Cover is limited to mortgage payments and related insurance premiums. Choice of back to day one or an excess of 30, 60, 90 or 180 days. Pointless having unemployment only or accident/ sickness only as savings are small. Standard rate £4.76 for 50 or under rising to £5.65 for 51 and over. Taking a 180 day excess reduces the rates to £1.47 for under 25s rising steadily to £6.14. Maximum age at inception : 64. Can cover self employed or controlling directors.
	Instead of mortgage protection, you buy insurance for your income up to £1,500 or 50% of gross income. Slightly more expensive than the scheme above. e.g. Standard rate is £4.81 for under 50 rising to £60.20 for the 51 and over. With a 180 day excess the lowest rate is £1.84.
	This is a combined mortgage protection where you can add on income protection to your insurance. The rates are hard to specify as a policy fee is included and vary with how much is mortgage protection and how much is income protection insurance. Limits are : £1,500 or 50% of gross income. £1,000 cover costs £41.08. Quotes for self employed/ controlling directors. (unemployment = cessation of business). Again there is a 30 or 60 day excess and unemployment only cover is not worth it. The actual underwriter is more friendly than many and eager to help.
	Scheme for mortgage protection and provides insurance for your monthly commitments. Short initial exclusion period (60 days). Maximum monthly cover is £3,000 or 90% of take home pay. 12 or 18 months benefits and you can take a 30 or 60 day excess. Rate varies depending on commitments to be covered but unemployment rate is about 3% and combined cover 5%. Please note we have to prepare each quote individually - you can't buy this policy online but the unemployment only rate is probably going to be the cheapest of the four contracts.

Cover Options

Our mortgage protection policies provide insurance against accident, sickness and unemployment or redundancy. (best cover). Although you can have unemployment only, accident or sickness only the difference in the insurance premium is not much. Also you should be aware that if you select unemployment only cover and then lose your job, should you have an accident or sickness and be unable to sign on then the insurance would not pay you.

Income payment protection - additional benefits available

Although mortgage protection is the most important element, we suggest you should seek income protection insurance to cover additional costs. After all you will still have substantial additional costs e.g. loans, utility bills, council tax should you lose your job and it is unlikely that you would qualify for any income support e.g. if you have another breadwinner in the household or substantial savings.

Please note that the mortgage protection element of the insurance is paid to the lender and so does not count as income. Additional benefits that are paid to you do count as income. To us this is unfair as in some circumstances you are penalised for your prudence.

You may be able to buy more than one policy i.e. from two different companies providing the TOTAL cover is less than 50% of your gross i.e. pre-tax earnings.

Eligibility

Mortgage protection (and other protection insurance) has had a bad name due to mis-selling by the banks - in particular in selling a policy unsuitable, or for which a claim cannot be paid. As we do not cross-sell this form of insurance there is no pressure on our staff to mis-sell the product. If you need to check if you are eligible for the insurance just call us, but in general:-

You must be a UK resident
You must be between the ages of 18 and 60 (64 with some companies)
You must be in full time employment (i.e. more than 16 hours a week), self employed or a controlling director
This normally means that 'temping' jobs are not covered
You must have been in work for at least 6 months and not be aware of any circumstances that could result in you losing your job e.g. mergers/ acquisitions/ suspicion that the company is in financial difficulty etc
If you have any medical conditions you should be aware that most companies will exclude them
You should understand that each policy will have an initial exclusion period where unemployment will not be covered if it announced. This initial exclusion period varies from 60 to 120 days. It may (not will) NOT apply if you take out a policy at the same time as your mortgage OR you switch companies.

income protection insurance premiums and cover

Key Features about mortgage protection

When looking for mortgage protection you should be aware of the following terms used in the insurance.

Initial Exclusion Period

An 'Initial Exclusion Period' is the period from the commencement of the insurance, during which the policy will not be effective should an announcement of job loss be made - even if the actual date of the loss of employment is later. This is to stop people taking out insurance when they know that their employment status is uncertain. The length varies between 60 days and 120 days but may be removed under some circumstances.

Excess or deferred period

With mortgage protection, in our opinion, you should avoid having an excess. The Excess or deferred period is the period from the time when a valid claim commences to the start of paying of benefit. Please note that the commencement date is NOT the date that you lose your job - it is the date on which you become eligible to receive benefits. If, for instance, you are paid 3 months 'cash in lieu' the commencement date would begin 3 months after the termination of your contract. Our policies by default are 'back to day one' so the insurance will start paying out after 30 days.

On some mortgage protection, you must be off work for at least 30 days after the expiry of the excess period before a claim may be paid on the insurance (i.e. day 61)

Back to day one

Back to day one is equivalent to a 'NIL' Excess or deferred period. We recommend that any policy you take out should be on this basis as it means that, providing you have been off work for a certain length of time, your benefits will be paid commencing on the first day that you were eligible to claim.

Benefit Period

The length of time for which the benefit is paid under the policy. All our policies quoted for on-line have a 12 month benefit period - but 18 months is available with one insurance policy.

About us

We are Insurance Brokers based in North-East England and have three offices - at Gateshead, Consett and Bishop Auckland. We have been in business since 1963 and transacted online since 1997. Our ethos has always been to treat our customers fairly and ensure that they obtain the correct policies they need.