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About Mortgage Protection Insurance

  • 24-09-2008 9:06am
    #1
    Eurorunner
    Closed Accounts Posts: 2,393 ✭✭✭


    My employer is a large US Multinational. They're going through a rough patch at the moment. Just wondering is it possible to start mortgage protection insurance at any time? I'm only a couple of years into a mortgage - and had no concerns at the time so didn't even consider taking it out.

    If it is possible, is there a minimum initial period that they will not pay out on? eg. they don't pay out on claims within the first six months/year etc.

    Do these policies work solely on the basis of being laid off ie. policy holder loses job (through no fault of their own) and insurer pays out?


Comments

  • #2
    Xcellor
    Registered Users, Registered Users 2 Posts: 2,821 ✭✭✭Xcellor


    You would need to confirm with the insurance company but I believe if you have solid reasons to believe that you are going to be laid off like announcement then you cant avail of the insurance. If you are only suspecting this to happen you might be OK.

    My wife and I took out this type of protection when we got the mortgage, at the time we were both working in the same company so it was a safeguard. We did have to use it once for a couple of months due to extended sickleave.

    It's important to know that you don't get money straight away, you have to be without employment for 30 days before you can claim. You will get this in addition to any government unemployment benefits. Don't confuse mortgage protection with income protection, mortgage will only pay the mortgage repayment. You can set it a few % higher to cover insurance etc but you won't have much if anything left over. You might want to check into income protection as well.

    best of luck!
    X


  • #3
    GeturGun
    Registered Users, Registered Users 2 Posts: 289 ✭✭GeturGun


    What you are talking about is payment protection (which pays your monthly payments), not mortgage protection (which clears your mortgage if you get ill/die)

    As far as I know, you can only take this out within a certain time after drawing down the mortgage - like 30 days or something. There also can be restrictions on redundancy cover - or knowing about redundancy cover within 90 days of taking out the policy

    You might want to check with your mortgage provider.


  • #4
    faceman
    Moderators, Category Moderators, Arts Moderators, Entertainment Moderators, Social & Fun Moderators Posts: 16,663 CMod ✭✭✭✭faceman


    OP read the small print of payment protection (which as pointed out by GeturGun seems to be what you are refering to. Many policies dont pay out for a number of months and you dont necessary your full salary etc.

    As far as I know most just cover redundancy.


  • #5
    Eurorunner
    Closed Accounts Posts: 2,393 ✭✭✭Eurorunner


    Yes, payment protection is what I meant. Will try and get some quotes - IF its still possible as its a couple of years since start of mortgage.
    I would expect them to have an exclusion period - just a question of how long. It would make more since to have now rather than before, as more likelihood of being laid off (albeit i could still be in same job for next ten years...who knows).

    I'm sure this varies but generally, for how long do they cover payments?


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