Mortgage Protection

What is it?

Mortgage Protection is basically lifecover directly linked to the repayment of a mortgage or loan. Most mortgage protection plans are actually decreasing term assurance plans, but the term mortgage protection is often used to make it easier to understand.

Mortgage Protection plans are designed to pay off the mortgage in the event of death at any time providing the mortgage interest rate applicable to the loan is within a certain level (usually up to 10%).

Who is it for?

This type of plan is available to anyone borrowing money and wishing to ensure repayment upon death during the term of borrowing. Whilst the term 'mortgage' is used, this type of plan can be used for other types of loans, e.g.) car loans.

What is not covered by mortgage protection?

Mortgage Protection plans do not normally cover:

• Unemployment or redundancy
• Any illness or injury sustained before the mortgage is taken out.

In order to protect yourself against the above, a seperate plan is required known as a Mortgage Payment Protection Insurance (MPPI).