What Is Mortgage Payment
Protection Insurance?
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Mortgage payment protection
insurance is also sometimes classified as accident, sickness and
unemployment (ASU) insurance.
Mortgage payment protection insurance (MPPI) represents a insurance
policy whether in a single or joint names that will pay your mortgage
payments. Usually after a deferment period lasting 30, 60 or 90 days and
further after your normal income ceases due to an act beyond your
personal control which leads to either:
unemplyment or
redundancy
accident
illness
However, this policy only continues for a limited period of time,
normally 12 or 24 months, depending upon the policy terms and the policy
provider. Beyond this period the mortgagee will be responsible for
meeting the rest of the payments.
Before you take out MPPI, the following points need to be considered:
This type of policy is optional and
is not compulsory when taking out your mortgage.
MPPI can be purchased from
independent insurance brokers and it could be cheaper than purchasing
from your lender and high street banks and building societies.
These policies have certain
exclusions, for example those with certain pre-existing medical
conditions should check if they are covered ( stress and backache is not
covered).
For an unemployment claim to succeed,
you should have been in full time employment for the past 12 months at
least before the insurance policy will compensate.
There are also restrictions which
apply to the self employed.
Most MPPI policies can be cancelled
during the initial cooling off period of 14 days.
Further MPPI policies do not apply to:
Those under 18 years.
Those over 65 years.
Those on temporary contracts.
Those working part time and less than
16 hours per week.
Those who are to be made redundant.
Finally, ensure that you read the keyfacts and fully policy terms before
taking out this form of insurance.
This article carries a disclaimer which is available upon request from
www.emortgageprotection.co.uk. Mortgage Payment Protection Insurance Plans provide you with a
opportunity of continuing your mortgage payments in the event of
unemployment or sickness/illness or an accident/disability.
Most people are mistaken if you fall ill or become redundant that the
state will financially look after your interests. Did you know ?
The government will not pay interest on your mortgage:
If you have savings over £8,000.00.
If your partner is working full time, and you are not working.
The government will not help
with mortgages taken out since October 1995.
Capital payments will not be made on your behalf, even if you have
Capital & Interest mortgage.
Interest payment on mortgages over £100,000.00 will not be made,
even so if
you have a mortgage over £100,000 which is very common considering an
average house in the UK costs circa £175,000.
Interest payments for the first nine months will not be paid, even if
you satisfy state benefits. Do you have enough savings to meet your
mortgage payments if the worst happened ? |
