Mortgage Protection Insurance Discussion

fairmove

Hello everyone, would appreciate some advice please. I took a mortgage out in 2005 and took MPPI cover for my husband and myself with Paymentshield at the same time. I was made redundant in Jan this year and have only just decided to apply to claim. Having actively sought a job from day 1, I simply did not expect to be jobless for so long. What complicates it for us is that my husband resigned his job in Aug 2012 and has not worked since. He has never applied for nor receives any benefits. We informed Paymentshield of this at the time by phone but they say they have no record of it. We also reduced our mortgage payments to interest only and I let them know (I have a copy) in the expectation that the MPPI premium would be reduced, but they replied to the email with a phone call - which again there is no record of. I am in receipt of contributions-based JSA. Does anyone know how the claim application will be/is likely to be treated? Thanks for reading. Any advice, experience share greatly appreciated.

dunstonh

Does anyone know how the claim application will be/is likely to be treated?

If you were made redundant and have signed on then its likely the claim will be successful.

fairmove

They told me over the phone that my husband would be taken off the insurance/claim, and I would be paid 50% of the payments we were insured for. Would that be the correct procedure?

dunstonh

fairmove wrote: »

They told me over the phone that my husband would be taken off the insurance/claim, and I would be paid 50% of the payments we were insured for. Would that be the correct procedure?

That sounds correct. Most policies are set up on the basis of 50/50. However, they can be adjusted to 60/40, 10/90 or 100/0 or any combination.

tgroom57

would the team please clarify what they mean in the article by "with a mortgage of £1,000"

does that mean a monthly mortgage payment of £1,000 ?

PDK123

Would a provider regularly check up that you are attempting to find a new job? If, say, you earned £Xk per year and you were only looking for roles at the amount and not roles that were <£Xk per year (or even turning them down) would they stop paying MPPI?

dunstonh

PDK123 wrote: »

Would a provider regularly check up that you are attempting to find a new job? If, say, you earned £Xk per year and you were only looking for roles at the amount and not roles that were <£Xk per year (or even turning them down) would they stop paying MPPI?

Yes. They do normally check for evidence that you are applying for roles. And yes, they can turn it off if they believe you are not.

newbie2013

Hi,

Not sure if this is the right place for this post, but what I have found/discovered is that when you contact an advised service or broker, they ask you the questions that you complete in non advised service and then you get passed to the underwriting of the insurance company anyway.
I only require cover for my mortgage with a level of critical protection. Just wondering why some say advised is best, as you can always go back to them if the insurance company refuses to pay out, as the advised service would take some element of responsibility - is that correct?

Hope that my post makes sense....?

dunstonh

what I have found/discovered is that when you contact an advised service or broker, they ask you the questions that you complete in non advised service and then you get passed to the underwriting of the insurance company anyway.

That is one method used by some advisers (typically networks or tied agents). However, it is not the only method (IFAs still tend to do it in-house).

I only require cover for my mortgage with a level of critical protection. Just wondering why some say advised is best, as you can always go back to them if the insurance company refuses to pay out, as the advised service would take some element of responsibility - is that correct?

Insurance companies have consistently said that they have less problems with non-disclosure claims and incorrect information with advised cases than non-advised.

Non-advised sales have a lower level of consumer protection.

Also, advice is not just about completing the application. it is about what type of insurance, what product provider, what version, what terms etc. Critical illness cover, for example, varies significantly across the providers. So, the adviser can cover that point.

you can DIY if you know what you are doing and you may save some money if you do. However, a frequent thing we see on this forum is where people who wanted CI cover and went DIY ended up buying a policy with terminal illness cover thinking it was the same thing. If they suffered a claim, that saving of a few pennies/pounds in premium would look very short sighted.

kingstreet

newbie2013 wrote: »

Hi,

Not sure if this is the right place for this post, but what I have found/discovered is that when you contact an advised service or broker, they ask you the questions that you complete in non advised service and then you get passed to the underwriting of the insurance company anyway.
I only require cover for my mortgage with a level of critical protection. Just wondering why some say advised is best, as you can always go back to them if the insurance company refuses to pay out, as the advised service would take some element of responsibility - is that correct?

Hope that my post makes sense....?

I may be completely misunderstanding here but the difference is you may end up with a different provider and obtain different terms.

If answering the same medical questions then obviously the answers will all be exactly the same.

The question therefore is, do you think you can pick the correct provider better than someone who does it for a living...?