It’s necessary to have insurance in place to cover our cars and homes but why do we not have to have insurance in place to cover our lives? It is not mandatory to have insurance when getting a mortgage, but why wouldn’t you want to protect yourself and your family?

In life the most important thing is you! Without you, you would not have a house, a car, a job or even a family so why would you not protect your most important asset? Insurance acts a safety net to cover your monthly mortgage repayments if you can no longer afford them due to a range of circumstances. It can prevent you from having to default on your mortgage, and so avoid repossession of your home.

There are many different types of insurance you can have to help protect you and your income. Let us give you a short run down of these insurances.

Mortgage Protection

Mortgage protection insurance is a type of policy that helps to pay your monthly mortgage repayments if you can’t work due to illness, a serious injury or redundancy. Sometimes it’s called Mortgage Payment Protection Insurance (MPPI).

Life Insurance

Life insurance is a policy that is put in place to pay a lump sum when you pass away. You would have this in place to cover a mortgage or even to pay a lump sum to family or dependants to cover funeral costs and general living expenses. This cover would give you the peace of mind that your loved ones are looked after when you’re no longer here.

Critical Illness Cover

A Critical Illness Policy would pay out a lump sum on diagnosis of a specific critical illness. The exact illnesses covered vary from provider to provider, but the main conditions would be highlighted as cancer, heart attack and strokes, but it won’t cover you for an injury. This would give you the peace of mind to know that if you were unable to work due to one of these conditions you would receive a lump sum to clear your mortgage or have in the bank to protect you and your family. .

Income Protection

It covers a portion of your salary on a monthly basis, rather than just your monthly mortgage payments if you were to be off work due to illness or injury, and it usually pays you for longer than the MPPI limit of two years, sometimes until you are able to return to work.

If you feel any of these policies are suitable for you whether you have a mortgage or not please contact our resident Mortgage & Protection Adviser Rachael on 07957 357212 or rachael@allentomasfinancial.co.uk