Buying a home is a big investment and often requires a mortgage. However, life is unpredictable and there may be unforeseen circumstances that make it difficult to make monthly mortgage payments. This is where mortgage protection insurance comes in. It is designed to protect homeowners by covering mortgage payments in the event of unforeseen circumstances such as an illness, disability, death or job loss. In this article, we will discuss the best mortgage protection insurance to help you decide which one suits you best.
What is Mortgage Protection Insurance?
Mortgage protection insurance is a type of insurance that pays off your mortgage in the event that you die or become disabled. It is designed to give you peace of mind and security knowing that your home will be taken care of should anything happen to you.
Mortgage protection insurance is not the same as mortgage life insurance. Mortgage life insurance only covers your mortgage if you die, whereas mortgage protection insurance covers your mortgage if you become disabled, unemployed or critically ill.
There are different types of mortgage protection insurance policies, including level term, decreasing term, and whole-of-life policies. These policies offer different levels of protection, so it is important to understand the differences before choosing a policy.
The Best Mortgage Protection Insurance Providers
When it comes to choosing the best mortgage protection insurance provider, there are a variety of factors to consider. These include the level of cover offered, the cost of the policy, the length of the policy, and any exclusions or limitations.
Here are the top five mortgage protection insurance providers:
Provider |
Level of Cover |
Cost |
Length of Policy |
Exclusions or Limitations |
|---|---|---|---|---|
Legal & General |
Up to £2,500 per month |
Depends on individual circumstances |
2-50 years |
Excludes pre-existing medical conditions |
Aviva |
Up to £3,000 per month |
Depends on individual circumstances |
5-40 years |
Excludes self-inflicted injuries |
Vitality |
Up to £5,000 per month |
Depends on individual circumstances |
5-50 years |
Excludes drug or alcohol misuse |
Scottish Widows |
Up to £2,000 per month |
Depends on individual circumstances |
5-25 years |
Excludes lifestyle factors such as obesity |
LV= |
Up to £1,500 per month |
Depends on individual circumstances |
2-50 years |
Excludes certain types of cancer |
Legal & General
Legal & General is a trusted mortgage protection insurance provider that offers up to £2,500 per month to cover mortgage payments in the event of illness, disability, or job loss. The length of the policy can be 2-50 years and the cost of the policy depends on individual circumstances. Legal & General does have exclusions for pre-existing medical conditions, so make sure you read the policy carefully before purchasing.
Legal & General also offers dual life insurance policies, which allow couples to take out a joint policy. This can be a more cost-effective way to protect both individuals in the event of death or critical illness.
Aviva
Aviva is another popular mortgage protection insurance provider that offers up to £3,000 per month to cover mortgage payments. The length of the policy can be 5-40 years and the cost of the policy depends on individual circumstances. Aviva does have exclusions for self-inflicted injuries, so make sure you read the policy carefully before purchasing.
One of the benefits of choosing Aviva is that they offer a free service called MyAviva that provides support and advice to policyholders. This can be especially helpful if you need to make a claim.
Vitality
Vitality is a newer mortgage protection insurance provider that offers up to £5,000 per month to cover mortgage payments. The length of the policy can be 5-50 years and the cost of the policy depends on individual circumstances. Vitality does have exclusions for drug or alcohol misuse, so make sure you read the policy carefully before purchasing.
Vitality also offers additional benefits such as access to a nurse helpline, online health assessments, and discounts on healthy living products and services. These benefits can help policyholders to maintain their health and well-being.
Scottish Widows
Scottish Widows is a well-established mortgage protection insurance provider that offers up to £2,000 per month to cover mortgage payments. The length of the policy can be 5-25 years and the cost of the policy depends on individual circumstances. Scottish Widows does have exclusions for lifestyle factors such as obesity, so make sure you read the policy carefully before purchasing.
One of the benefits of choosing Scottish Widows is that they offer a premium waiver benefit that means policyholders will not need to pay premiums if they become seriously ill or disabled.
LV=
LV= is a reliable mortgage protection insurance provider that offers up to £1,500 per month to cover mortgage payments. The length of the policy can be 2-50 years and the cost of the policy depends on individual circumstances. LV= does have exclusions for certain types of cancer, so make sure you read the policy carefully before purchasing.
LV= also offers a range of other insurance products such as life insurance, critical illness cover, and income protection. This means you can get all of your insurance needs met in one place.
FAQs
What is covered under mortgage protection insurance?
Mortgage protection insurance covers mortgage payments in the event of illness, disability, job loss or death. The level of cover depends on the policy and provider chosen.
Is mortgage protection insurance mandatory?
No, mortgage protection insurance is not mandatory. However, it can provide peace of mind and security knowing that your mortgage will be covered should anything happen to you.
How much does mortgage protection insurance cost?
The cost of mortgage protection insurance depends on individual circumstances such as age, health, and the level of cover required. It is important to shop around and compare policies to ensure you get the best deal.
Can I cancel my mortgage protection insurance policy?
Yes, you can cancel your mortgage protection insurance policy at any time. However, you may have to pay fees or penalties depending on the terms of the policy.
Is mortgage protection insurance the same as mortgage life insurance?
No, mortgage protection insurance and mortgage life insurance are different. Mortgage protection insurance covers mortgage payments in the event of illness, disability or job loss, whereas mortgage life insurance only covers mortgage payments in the event of death.
Conclusion
Choosing the best mortgage protection insurance provider requires careful consideration of a variety of factors such as the level of cover offered, the cost of the policy, the length of the policy, and any exclusions or limitations. Legal & General, Aviva, Vitality, Scottish Widows, and LV= are all trusted mortgage protection insurance providers that offer different levels of protection at varying costs. It is important to shop around and compare policies to find the best one for you.