Do You Understand Mortgage Payment Protection Insurance

Do You Understand Mortgage Payment Protection Insurance

Do you​ Understand Mortgage Payment Protection Insurance?
Sadly not many people do truly understand mortgage payment protection insurance (MPPI),​ yet each year many buy it​ alongside their mortgage thinking that it​ will provide them with the​ income needed to​ keep the​ roof over their head if​ they should come out of​ work .​
While in​ most cases it​ can do this there are certain exclusions which mean it​ you​ could be ineligible to​ claim .​
Unless you​ know about these and have checked them in​ the​ small print to​ make sure your circumstances would permit you​ to​ make a​ claim,​ then your cover could be nothing more than a​ waste of​ money.
Mortgage payment protection insurance can work but it​ is​ essential that you​ understand what you​ are buying and what a​ policy can and cannot do .​
Typical reasons which could mean you​ would be ineligible to​ claim include if​ you​ are only working part time,​ are of​ retirement age,​ self-employed or​ if​ you​ have a​ pre-existing medical condition at​ the​ time of​ taking out the​ policy .​
Policies differ and while these are the​ most common you​ can find others listed in​ the​ small print of​ the​ policy so it​ is​ essential to​ read them from top to​ bottom.
If a​ policy is​ suited to​ your circumstances then it​ would begin to​ give you​ the​ tax free sum you​ agreed upon at​ the​ time of​ getting your quote,​ which was based on​ your age and amount needed each month to​ make sure that you​ can carry on​ servicing your mortgage repayments .​
You do have to​ be out of​ work for a​ set period of​ time before the​ policy kicks in​ and again this can vary with providers but is​ usually anywhere between the​ 31st day and the​ 90th of​ being out of​ work .​
Once the​ policy has kicked in​ then it​ would continue to​ pay out for between 12 and 24 months,​ which means that you​ have plenty of​ time to​ recover and get back to​ work without the​ added worry of​ finding the​ mortgage money each month .​
Some of​ the​ biggest problems with mortgage payment protection insurance cover have been the​ lack of​ information regarding the​ exclusions,​ how much the​ cover costs in​ total over the​ term of​ the​ mortgage and the​ high cost of​ the​ premiums .​
High street lenders charge way over the​ odds for the​ cover and this can add hundreds more onto the​ cost of​ the​ mortgage than it​ should if​ you​ had gone with a​ specialist provider .​
Besides saving you​ a​ great deal on​ the​ premiums each month and total amount you​ pay for the​ cover,​ the​ standalone provider will give you​ all the​ information you​ need to​ ensure that a​ policy is​ suitable for your needs before you​ buy,​ this means you​ are able to​ make an​ informed decision regarding the​ suitability of​ the​ policy before you​ buy.
One of​ the​ biggest changes to​ come out of​ the​ investigation by the​ Financial Services Authority which started in​ 2018 after a​ super complaint was made to​ the​ Office of​ Fair Trading by the​ Citizens Advice,​ is​ the​ planned introduction of​ comparison charts in​ March 2008 .​
The charts will allow the​ consumer to​ make an​ informed decision after answering a​ set of​ questions in​ relation to​ policies,​ along with this it​ will show how much the​ cover will cost and also highlight the​ fact that there are exclusions,​ something which at​ the​ moment is​ clearly lacking.

Mortgage payment protection insurance has to​ be understood and right now the​ only place where you​ can get the​ information needed to​ determine if​ a​ policy is​ suited to​ your needs is​ to​ go with an​ ethical specialist in​ payment protection.

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