Mortgage Protection - query!

regularsaver1

The only insurance that is compulsory is Buildings insurance

the others are suitable IF they meet yours needs

MortgageMamma

ASU will cover your mortgage payments for 1 or 2 years dependent upon the policy in the event of accident sickness or involuntary redundancy. You can have different deferred periods i.e. the period in which you cant claim so in your case 6 months from commencement of illness/redundancy but some will only let you go to three months. The policy is not medically underwritten but generally asks on application if you have seen your doctor in last 12 months and are you under notice of redundancy or in any disciplinary action with your employer.

a Permanent Health Insurance Policy will pay 60-70% (roughly) of your salary up until retirement, rehabilitation, death or the end of the policy whichever is the soonest, in the event of being unable to work through illness/injury. It does not cover redundancy. PHI or long term income protection policies are the better policies to take as they insure you over the long term, and, as the name states it is a permanent policy, which means you can make as many claims as you want over the term and its uncancellable by the insurer. At your age, assuming you are a non-smoker, I think it would be cheaper to take one of these policies with a 6 or 12 month deferred period than the ASU, but remember if your employment circumstances change and you somehow lose your 6 months full pay, you will need to revisit this with your adviser. These policies are medically underwritten so you may need a doctors report or medical. They are complex policies and the cheapest is not always the best, in fact some of the cheaper ones carry so many exclusions they are not worth having IMO - make sure you seek professional advice if you are considering this, stand alone redundancy cover would be advisable too.

I hope this helps a little - there's far too many factors and variables to go into everything on a forum but this should give you an idea what is available to you

MortgageMamma

Rick62

Agree with JoeK and MM. The ASU would only cover you for 12 months (maybe 24 months) about the ame time you ssay your employer would cover you for anyway.

A permanent health policy with a 6 or even 12 month excess will be cheaper and give you much better long term protection.

djleekee

As you can probably tell Im a little bit thick on these matters - just dont mention the words Pension, Mortgage or Insurance to me! I just dont understand them all!

So basically you are saying dont bother with ASU but instead go for Life Insurance which will cover the same thing anyway and be cheaper?

I (think) I ve just got a quote back for Life Insurance which is at £10.23 - quote available HERE

Thanks

Lee

MortgageMamma

No Lee

Not life insurance, Permanent Health Insurance, doesnt cover you for death, but for long term disability and illness. You really need to sit down with an adviser who is used to first time buyers and talk through this properly, you can't be advised fully on a forum its not possible.

MM