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Mortgage Protection Insurance Query

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  • 20-10-2019 2:03pm
    #1
    TheSheriff
    Registered Users Posts: 1,108 ✭✭✭


    Hi All,

    Quick query I am hoping someone more experienced could help with.

    We are mortgage approved (FTB) with BOI and likely going to draw down from them once we find a suitable house.

    Currently, I am trying to have all our ducks in a row in terms of other requirements for draw down, which include mortgage protection.

    We've spoken to the BOI QFA, and they have provided us a somewhat reasonable quote. Doing my own research online, I can probably get a similar policy at about €8 cheaper per month elsewhere through a broker. I am also conscious BOI is essentially trying to sell me a product, and of course will indicate it would all be easier to just go with them.

    However, in the interest of not complicating matters to begin with, we were thinking we may sign up to the BOI insurance for the first year and then swap policy providers once we are hopefully settled in a house. The main benefit here is that BOI will not start taking payments until we draw down the mortgage - although I imagine this could be arranged with other providers also.

    Can anyone provide any insight on if its difficult to change providers after a year or two? Any fees etc I am not considering. I cannot see any reason why it would be , but wanted to make sure I am not missing something.

    Cheers in advance for any advice!


Comments

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    #2
    Dolbhad
    Registered Users Posts: 782 ✭✭✭Dolbhad


    I don’t know how easier it is to change but I’m not surprised the bank’s policy is cheaper because it’s more convenient. We had organised it through a broker. We aren’t married so did separate policies that we took out on each other (for tax purposes it would cover us if one of us and we got the house in fu as joint tenant and wouldn’t be liable for tax).

    Broker did say when we get married to change the policy to one joint policy as it would be cheaper and easy to do. But to be honest if your doing the paperwork now, go for the cheaper policy. The extra step is the life insurance team will need to send it to your bank - it might add a day or two on be process but your saving €8 a month on it.


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    #3
    jlm29
    Registered Users Posts: 3,818 ✭✭✭jlm29


    I’m pretty sure that when I got my mortgage protection, it was put in place quite quickly, because I’ve got no health issues. They also asked the start date I wanted, you should definitely be able to organise the policy quite quickly once you need it, unless there’s medical issues. I would just go with the policy that suits you better and is cheaper


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    #4
    mugsymugsy
    Registered Users Posts: 1,569 ✭✭✭mugsymugsy


    Also consider a life insurance policy that you can assign to the house.

    The reason I say this is mortgage protection is cover that stays the same cost per month but over time pays out less (only covers mortgage which will decrease over time).

    Life insurance will pay out the same amount and as you pay off the mortgage it will then in the event of kicking the bucket be useful.

    Do the numbers and consider the options.

    I went with a broker and have a life insurance policy assigned to the house.


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    #5
    Woshy
    Registered Users Posts: 1,429 ✭✭✭Woshy


    We did this- went with the lender for the first year to save on hassle etc and then switched after one year. It wasn't difficult to change providers, we just had to provide a letter from the new insurer to the lender to prove we did have insurance in place.


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    #6
    ted1
    Registered Users Posts: 23,299 ✭✭✭✭ted1


    mugsymugsy wrote: »
    Also consider a life insurance policy that you can assign to the house.

    The reason I say this is mortgage protection is cover that stays the same cost per month but over time pays out less (only covers mortgage which will decrease over time).

    Life insurance will pay out the same amount and as you pay off the mortgage it will then in the event of kicking the bucket be useful.

    Do the numbers and consider the options.

    I went with a broker and have a life insurance policy assigned to the house.

    A convertible life assurance is what you want.


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    #7
    mugsymugsy
    Registered Users Posts: 1,569 ✭✭✭mugsymugsy


    ted1 wrote: »
    A convertible life assurance is what you want.

    I'll have to go and look it up but thanks for the suggestion


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    #8
    hanaimai
    Registered Users Posts: 207 ✭✭hanaimai


    One potential difficulty in switching is if you develop any health issues that might make you unacceptable to another insurer or only acceptable at a higher premium. Then you'd most likely be better off staying with your original insurer, but might end up kicking yourself for not going with the cheapest option in the first place.


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    #9
    TheSheriff
    Registered Users Posts: 1,108 ✭✭✭TheSheriff


    Hi All,

    Many thanks for the suggestions and info - all very much appreciated.

    I think we will progress with the banks policy for now and it seems like less hassle and swap within a year.


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    #10
    WayneEnterprise
    Registered Users Posts: 602 ✭✭✭WayneEnterprise


    TheSheriff wrote: »
    Hi All,

    Many thanks for the suggestions and info - all very much appreciated.

    I think we will progress with the banks policy for now and it seems like less hassle and swap within a year.

    It takes minutes to put a mortgage protection policy in place. Just go with the cheaper quote, don't overpay the banks.


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    #11
    thelastpogue
    Registered Users Posts: 15 ✭thelastpogue


    Changing mortgage protection is a pain in the hole!! I went with the brokers recommendation for the first year and then decided to change over.
    To change mortgage protection you have to first of all take out a new policy, then get this policy assigned to your mortgage. This assignment had to be witnessed by a solicitor, €25 for them to watch us sign a page!
    Then sent to our mortgage (haven) who say the switching process can take 6-8 weeks! All the while we had to leave our original policy and our new one active and paying for both.

    In the end it has taken me close to 3 months to have my new policy assigned and finally cancel my older and more expensive one! 3 months where I had 2 policys live and paying for both!!

    Now is the best time for you to go with your cheaper quote, much much easier when taking the mortgage our rather than swapping over!


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    #12
    DublinCJM
    Registered Users Posts: 826 ✭✭✭DublinCJM


    thelastpogue wrote: »
    In the end it has taken me close to 3 months to have my new policy assigned and finally cancel my older and more expensive one! 3 months where I had 2 policys live and paying for both!!

    I've just done this with Bank of Ireland and it took about 4 days.

    Sounds like your bank are dragging their heels.


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    #13
    Woshy
    Registered Users Posts: 1,429 ✭✭✭Woshy


    thelastpogue wrote: »
    Changing mortgage protection is a pain in the hole!! I went with the brokers recommendation for the first year and then decided to change over.
    To change mortgage protection you have to first of all take out a new policy, then get this policy assigned to your mortgage. This assignment had to be witnessed by a solicitor, €25 for them to watch us sign a page!
    Then sent to our mortgage (haven) who say the switching process can take 6-8 weeks! All the while we had to leave our original policy and our new one active and paying for both.

    In the end it has taken me close to 3 months to have my new policy assigned and finally cancel my older and more expensive one! 3 months where I had 2 policys live and paying for both!!

    Now is the best time for you to go with your cheaper quote, much much easier when taking the mortgage our rather than swapping over!

    That sounds very strange. We changed our policy with EBS and all we had to do was to send them a letter with proof we had taken a policy out elsewhere and the original policy was cancelled. It also took about four days. No solicitors or anything were needed. Sounds like that is an issue with Haven.


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