What insurance can I have with my mortgage?
life coverage
Life Cover provides a lump sum if you die during the term of the policy. This can be used to pay off your mortgage so your family doesn’t have to worry about making any more payments.
Critical Illness Coverage
Critical Illness Coverage is designed to insure against critical illnesses that could severely impact your ability to earn a living. You must pay if you are diagnosed with one of the serious illnesses or disabilities listed in the policy. You could then use the lump sum to pay off your mortgage or help pay for high medical costs. Some policies pay on death during the coverage period if you are eligible to claim.
Accident, Sickness and Unemployment Coverage
Accident, Sickness and Unemployment Coverage is a short-term income protection policy. It pays you a monthly tax-free sum for up to 12 months if you are unable to work due to an accident or illness or if you lose your job through no fault of your own. There are policies available that protect you against all of these events or just cover you for accident and sickness only, or unemployment only.
This type of insurance is expensive, so to reduce the cost you can choose to have a ‘deferred period’. Then, in the event of a loss, you will not receive any benefits for a period of time at first. This postponement could be 30, 60 or 90 days for all three types of claims. You can also have a longer deferred period of 180 days for accident and sickness coverage. To help you decide which deferral period is best, you should consider things like any savings you may have and any sick pay you receive from your employer.
You can choose the monthly benefit amount you want to receive up to 65% of your gross monthly income. Gross income is your salary before deductions, such as income tax and National Insurance contributions, have been taken. Of course, the higher the benefit you need, the higher the cost of insurance. The coverage provided by some companies may be limited due to individual circumstances.
As an example, Accident, Sickness and Unemployment cover typically costs £4.71 per month for every £100 of monthly benefit. This is based on a 36 year old client electing £850 monthly Accident, Sickness and Unemployment benefit with claims paid after a 30 day deferral period.
The cost of this insurance depends on a number of factors including your age, your occupation, and where you live.
Several companies offer short-term income protection and other products designed to protect you against loss of income.
Building Insurance
This covers the structure of the house, such as the roof, walls, windows, and permanent fixtures.
content insurance
This covers household items, personal possessions, and valuables inside the home.