Mortgage Payment Protection Insurance

slowfish6873

Hi

If we have a joint mortgage and the monthly payments are going to be £800, should we each have a MPPI policy that pays out £800 pm. Or can we half the payout amount to £400 each (which assumes the other half can cover the rest of the mortgage and carries on working)

Thanks

regularsaver1

some insurers will allow you to split the benefit 50 / 50 , or even 75 / 25

as long as the person with the higher income has at least 50%

Astaroth

There are many different types of policies out there.... some allow you to reduce the benefit paid if there is only one claimant others will pay out the full amount if the insured person has a valid claim even if the insured person is the lower earner of the two.

jasonking

As others have said it depends on the insurer, some can some cant. You need to think about how much money you would need coming into the household to meet the mortgage payments if either of you were unable to work. If you both earn about the same amount then a 50/50 split sounds fair enough. However MPPI has its drawbacks and significant exclusions. Depending on your circumstances Income Protection (Permanent Health Insurance) may be a better and cheaper bet. Find an adviser that knows about both perhaps?

metalmickey_2

I have just been made redundant and my MPI provider suggest in their T&Cs that they wont payout until any Payment in Leu of Notice is spent...

ive just called the mortgage protection poeple and they says they wont make a payment until after "payment in leu of notice" and they decribe it in their t &cs as

4.24. Payment in Lieu of Notice - means either of the following:

4.24.1. Any payment You receive relating to the notice period Your employer should have given You under the terms of Your contract of Employment or letter of appointment; or

4.24.2. Any part of a compensation payment made for loss of office (including any part of a payment made under a compromise agreement and/or redundancy package) whether this directly or indirectly relates to the notice period Your employer should have given You under the terms of Your contract of Employment or letter of appointment, or not.


Im to recieve a sum related to my lengths of service, but im also contracted to continue working my full 3 months notice which means i wont get any PILON.

Does this mean they wont payout until ive spent my redundancy offer?

thanks for any light you can shed.

Astaroth

No

If you had 3 months notice on your contract and they have said you dont have to work this then you will receive 3 months pay in lieu of working it and your redundency pay.

What the PPI is saying is that it wont pay you for 3 months as whilst you are not actually working you have been paid for working (similar to garden leave). After that you can claim under the PPI irrespective of the redundency money