Mortgage Protection Renewal

LadFromLimerick

Hi all,
Most brokers offer huge discounts (up to 90%) on mortgage protection policies for the first year, is there anything stopping me from changing insurers every year to avail of these first year discounts?
Many thanks!

jimoc

The main stumbling block to switching each year is the fact that most protection policies only come into full effect 12 months after you begin the policy.
Therefore if you keep switching you will never actually be covered, thereby wasting whatever money you put into the policy.

there may be some policies with a shorter activation period, but you would need to check the policy documents.

Henry Ford III

jimoc wrote: »

The main stumbling block to switching each year is the fact that most protection policies only come into full effect 12 months after you begin the policy.
Therefore if you keep switching you will never actually be covered, thereby wasting whatever money you put into the policy.

there may be some policies with a shorter activation period, but you would need to check the policy documents.

That's totally incorrect. The cover is in place immediately the policy comes into force - i.e. on acceptance and payment of the first premium amount.

There's nothing to stop the OP's suggestion. In theory at least.

jimoc

Henry Ford III wrote: »

That's totally incorrect. The cover is in place immediately the policy comes into force - i.e. on acceptance and payment of the first premium amount.

There's nothing to stop the OP's suggestion. In theory at least.

I stand corrected.

However it would still be worth reviewing both your existing policy and the new one as there may be limitations on what you can claim for in the first 12 months of a policy. For example, http://www.nationwide.co.uk/pdf/insurance/P8415_MPPI.pdf (English I know, but similar conditions over here)
If you take out a policy knowing of a medical condition or impending unemployment situation in the first 12 months of the policy then they wont pay out.

Henry Ford III

jimoc wrote: »

I stand corrected.

However it would still be worth reviewing both your existing policy and the new one as there may be limitations on what you can claim for in the first 12 months of a policy. For example, http://www.nationwide.co.uk/pdf/insurance/P8415_MPPI.pdf (English I know, but similar conditions over here)
If you take out a policy knowing of a medical condition or impending unemployment situation in the first 12 months of the policy then they wont pay out.

Ah - but that's mortgage payment protection insurance - which is a very different beast to a simple mortgage protection life policy.

The life policy pays out the sum assured on death.

jimoc

Henry Ford III wrote: »

Ah - but that's mortgage payment protection insurance - which is a very different beast to a simple mortgage protection life policy.

The life policy pays out the sum assured on death.

Ahh I read 'mortgage protection policy' in the original post as being the payment protection not as a life policy.

OP, can you clarify which product you actually meant?

LadFromLimerick

I was referring to a mortgage protection life policy, not payment protection.

tipptom

i have done this on the mortgagae protection with 75 of,even though i was paying the full premium up front they still wanted my direct debit details.cancelled it at the end of twelve months to be bombarded by calls insisting i take it up again,told him where to go,he said i was using the system and used some sort of terminology to describe it and said no one else would insure me.anyway i got insured with another crowd and explained to them about the year before,he did not care,just wanted to sign me up.was wondering can they insist on getting bank details when you have given over your full premium.

jimoc

LadFromLimerick wrote: »

I was referring to a mortgage protection life policy, not payment protection.

In that case ignore all my ramblings as they were directed at payment protection policies

As for life assurance, you can swap and change them as much as you like without any problem.