Mortgage Payment Protection - To What Extent Will It Help?

By Author: Shourya Ray Chaudhuri
Total Articles: 598
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Before you take out a protective cover, you must make sure for how long will the insurance pay you and what is the amount it is going to pay? If you are aware of these things you will be in a better position to protect your self. Mortgage payment protection as the name suggests will safe guard your mortgage payments. The monthly installments that you make every month to the lender will continue to be paid if you have protective policy.

You are not in jeopardy if you are well protected under this protection cover!

Protective cover against any risks involved in confiscation of your collateral. You know that your collateral will be at risk, if you don’t take proper protective measure against it. In order to be on time with the payments irrespective of your sickness, disability to work, accident, or lay off you must get this policy. This will help you have better and secured life as you know that there is a policy to cover you incase things went wrong.

You will be paid a mortgage payment up to 12 months duration. It will start covering you from one month of your inability to go to work. It is assumed that ...
... 12 months duration is enough for recovery or to find a job.

It covers you during the following circumstances:

- Accident
- Sickness
- Involuntary unemployment
- Hospitalisation

This policy cover will also offer you tax free income. When you have a policy in place you will be in a position to enjoy income which is tax free. This insurance policy is covered under tax exemption too. Therefore, if you find yourself out of work in future due to illness, or an injury from an accident or from involuntary redundancy; if you have a mortgage payment protection policy you will receive a monthly tax-free income that will cover in full or in part your mortgage repayments. Some insurers offer 100% coverage, and this should also include any interest payments that you need to make each month. If you’re looking for mortgage payment protection with a lower premium, you may only wish to cover a percentage of your monthly repayments and this is also possible.

There are certain exclusions to this policy such as:

- If you are self employed, under training or contract this policy is not covered.

- If you are made redundant only after a public announcement then you can’t claim. However, if it was privately told to you, then you can still claim from them.
- Anyone who has reached retirement age is automatically excluded due to pension eligibility and the higher risk associated with elderly people.

- If substantial savings already exist. Insurance cover is only for 12 months and it may be possible for those with savings to cover any costs for that period.

Shourya Ray Chaudhuri, Ezine Articles Expert Author.For more information: Mortgage Payment Protection
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