Protecting what’s important
Your home may be repossessed if you do not keep up repayments on your mortgage
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Here to help you look after what's important to you
Buying a house is the biggest financial commitment most of us will ever make, and it can become a risky one for anyone who finds themselves unable to keep up with mortgage repayments. Ensuring your home is protected in the event of your death or if you become seriously ill is therefore something that’s important to consider.
Are you prepared for what life may have in store?
Sadly, at some point or another we’re all likely to hear news of a friend or a relative who is off work for a few months, has been diagnosed with a serious illness or has unexpectedly died.
Get impartial protection advice as part of our complete mortgage service
A huge number of insurance and protection policies are available and when it comes to the cover they provide, they vary considerably. As impartial mortgage brokers, we can search a comprehensive panel of specialist providers for the most suitable and competitive products for you. We’ll ensure you’re able to continue to make mortgage payments in the event you become unable to work, repay the loan in the event of your death or contraction of serious illness, or arrange protection to cover your property and possessions.
Protection
Your expert Mortgage Style protection advisor will talk to you about your specific circumstances and make sure any solutions proposed are right for you, but here’s a summary of the policies we can recommend:
Life and Critical Illness
Life and Critical Illness insurance is a key part of planning for your future and the futures of any dependents. Protection or Life Assurance policies pay out a lump sum in the event of the death of the mortgage holder so that their spouse or dependents can repay the outstanding debt and are not faced with having to sell the property at a difficult time.
Critical Illness policies are designed to provide protection in the event of specified critical illness diagnosis. They can pay out a lump sum or a regular income which can be used to repay the outstanding debt or mortgage repayments. The plan may not cover all the definitions of a critical illness. For definition, please refer to the key features and policy document. The plan will have no cash in value at any time and will cease at the end of the term. If premiums are not maintained, then cover will lapse.
Income protection
If you were unable to work tomorrow how long would you be able to afford your mortgage payments for? What about your normal living costs including food and bills? You should not assume that sickness benefits will enable you to maintain your current standard of living. Loss of income will have big implications on your lifestyle.
Income protection allows you to cover some or most of your income in the event that you become unable to work. It’s particularly important to consider this protection if you are self-employed or don’t qualify for employment-based sickness benefits.
Income protection (with no investment link) has no cash in value at any time and will cease at the end of the term. If you stop paying premiums your cover may end.
Accident, Sickness and Unemployment
It’s possible to protect your income if you were unable to work due to an accident or sickness, or if you were made redundant. Accident, sickness and unemployment (ASU) policies are more informal than income protection – they’ll stay in place until either you cancel the policy, stop monthly payments or make a claim. They’re a sensible top up for your income if you need it but, unlike income protection which pays until you’re fit to return to work, ASU policies only pay out for a fixed period once you make a claim.
ASU tends to be more flexible than income protection as you can select how much cover you take and the period of time you’d like the payments to last if you ever need to use the policy. There’s no underwriting either which means fewer lengthy application forms and processing. ASU policies are the only way to protect your income if you’re made redundant.
Buildings and contents
Building and contents insurance is there to protect the physical structure of your home as well as your personal household possessions. Mortgage lenders will require you to have a suitable buildings insurance policy in place when you take out your mortgage. In the event that your property sustains physical damage, these policies will cover the cost of repairs.
Contents insurance is not compulsory but it’s worth thinking about to ensure that in the event of a fire, flood or even theft you can replace furniture, clothes and other personal possessions.
Kelly Flanagan is here to help
Kelly, our Senior Mortgage and Protection Advisor, has a wealth of experience in sourcing the right protection products for her clients. Her knowledge of basic employment cover and sickness benefits means she’s well placed to explain what you might expect to earn without cover. She can then help you bridge that gap with the right policy to protect your home should the worst happen.
Your home may be repossessed if you do not keep up repayments on your mortgage