Mortgage Protection

What is mortgage protection?

Mortgage life cover for a mortgage protection need could either be a mortgage term assurance contract, where the amount of cover you choose remains the same throughout the term (unless the policy is amended) or a mortgage decreasing term assurance contract, where the level of cover provided decreases broadly in line with the outstanding mortgage balance. Mortgage decreasing term assurance is designed to repay the amount outstanding on a repayment mortgage ‘capital and interest’ repayment mortgage should you die during the term of the mortgage. In other words, if the policyholder(s) die prematurely, the outstanding loan amount on the mortgage will be repaid in full.

Policies can include other benefits known as ‘riders’, which are extra sorts of cover, added on to the life cover.

Benefits can include (not exhaustive):

  • Waiver of premium, where the premiums are waived but the cover continues if you cannot work due to illness or injury
  • * Critical illness cover, where the benefit is paid before death on the diagnosis of life-shortening disease (e.g. cancer). This benefit may replace the death benefit, or it may be paid as well

All these riders cost extra and are only paid subject to meeting the policy criteria.

There are also other types of protection plans which may also be relevant to consider:

  • Income protection benefit, which can pay a percentage of your income to you if you cannot work due to illness or injury
  • Unemployment benefit, which is a variety of income protection benefit that covers unemployment

The importance of seeking financial advice

Eastcote Wealth Management has years’ of experience and can help you to determine the correct protection level required.

Please do not hesitate to contact us if you would like to discuss your options in more detail. Remember, we offer a free no obligation consultation and will be happy to help if we can. We take a holistic and long-term approach to wealth management, opting to build a lasting relationship with you and provide a tailored solution for all of your investment and protection needs.

The plan will have no cash in value at any time and will cease at the end of the term, If premiums are not maintained, then the cover will lapse.

*The policy may not cover all the definitions of a critical illness. For definitions, please refer to the key features and policy document.