The Importance of Mortgage Insurance

Posted on October 31st, 2015

The Importance of Mortgage Insurance

Life insurance, Critical illness, Income protection all come into consideration when applying for a mortgage. Couples with children whom have no saving, are putting themselves at considerable risk if illness, unemployment or an emergency should hit.

Life insurance should be a minimum if you’re applying for a joint application. Level, decreasing, guaranteed, reviewable all different types that should be discussed with an adviser.
Critical illness can be expensive as it covers the three most common claims cancer, heart attack and stroke. Most insurance providers cover a comprehensive list of conditions. Critical illness premiums are dependent on age and the older you are, the more expensive the policy.

If your self-employed and have proof of accounts, income protection should be considered as it provides a regular income when illness or injury stops you earning. Did you know- More than 130 million days were lost to sickness absence in 2013 (Office for National Statistics – Sickness Absence in the Labour Market 2014 – Aug 2015).

Prior to a mortgage application, an adviser will go through your insurance requirements and cover any shortfalls. Approximately you should budget 10% of the mortgage payment towards insurance and prioritise the important covers.

Consider ‘Fracture Cover’- A lump sum payment if you suffer a specific fracture. Speak to one of our mortgage advisers based in Manchester city centre for more information.

Some useful stats:

· More than a 1,000 people will be diagnosed with cancer every day in the UK in December 2016 (Macmillan Cancer Support)
· Half of the UK population will develop cancer at some point in their lives (Cancer Research UK)
· For men born in 1930 the risk of cancer was 39% while for those born in 1960 it was 54% (Cancer Research UK)
· Every two minutes in the UK….. Someone is diagnosed with cancer & has a heart attack (Cancer Research UK)
· 35% of UK couples with children have no savings aside for an emergency (DWP)
· 11% of people have CIC compared to 39% of people who have pet insurance (Mintel)
· 100 children every day in the UK are bereaved of a parent (Winston’s Wish)
· Every five minutes in the UK someone suffers a stroke…… 25% of stroke victims are aged under 65 (NHS Choices)

Mortgage insurance

Mortgage insurance