Mortgage Payment Protection Insurance

w00519772

I am thinking about getting Mortgage Payment Protection Insurance: Income Protection and Critical Illness Cover.

My mortgage is £541 PCM and I am responsible for all of it (I am single). I have £10K in savings. I bought my house in June.

I was thinking about getting MPPI just to cover the mortgage i.e. £541. What do other people have? Do you have £541 and a bit more. I have been with my current employer for five years and I believe my job is secure but you never know I guess.

I know someone who was recently diagnosed with cancer and had critical illness cover, which really helped. I am 32 years old. Do people tend to get this cover when they are older as the risk of critical illness increases.

Therefore my two questions are:

1) Is Income Protection worth it for single people in stable jobs with a little savings?
2) Is Critical Illness cover worth it for younger single people with a little savings?

dunstonh

1) Is Income Protection worth it for single people in stable jobs with a little savings?

Very much so. and married people as well. Illness can strike any time and stability of job is irrelevant. That only applies to payment protection plans and not proper income protection plans.

2) Is Critical Illness cover worth it for younger single people with a little savings?

Permanent health insurance (proper income protection) is typically a higher priority than CI cover but both are important considerations.

When looking at any insurance shortfalls, you have to consider the sequence of events that would occur if you were not covered. So, put you on long term illness and think about what will happen. Do the same with say cancer. How would you afford to pay bills if that happened.

InsideInsurance

w00519772 wrote: »

1) Is Income Protection worth it for single people in stable jobs with a little savings?
2) Is Critical Illness cover worth it for younger single people with a little savings?

By the sounds of it you are looking at the budget version of IP which is otherwise known as ASU. Personally I'd be looking at the full fat version of it PHI which pays out until your nominated date (normally 65th birthday) instead of the maximum 12/24 months that ASU pays.

(1) It depends, you contract an illness that means you will never be able to work again, what is your plan to get you to your pension? Can you make your savings last 33 years? Would you be happy just living on state benefits?

(2) I am not a fan of CI personally, I'd rather the PHI because my normal income continues and so life can continue as previously planned. Ok, if you get put in a wheelchair then the lump sum of CI is useful for the unplanned expense of having to adapt your house etc but then that can be where savings kick in.