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Mortgage Protection: The Basic Questions Answered

Updated: Apr 3, 2023


Mortgage protection is oft-discussed in the news and online these days, with promises of the lowest cost coverage in advertisements and numerous articles discussing spiraling costs. Online cost calculators and advertisements abound that explain why one insurance company is better than another. However, all this information assumes that you already have a basic understanding of insurance and mortgages. At Citywide Financial Solutions, we have found that most people seeking mortgage insurance don't have this basic knowledge. In fact, the jargon used in the other sources of information has only left them more confused. So, if you need mortgage insurance but don't know where to begin, don't worry. Almost every homeowner has felt this way at one time or another. To make practical information on mortgage protection more accessible, we have compiled a list of the most common questions our new clients ask. We've done our best to keep the information straightforward and avoid using complicated financial jargon.


What is mortgage protection?


Mortgage protection is insurance that helps you pay your mortgage in case something unexpected happens and you cannot pay. It gives you peace of mind that your mortgage will be covered even if you experience financial hardship. There are two main types of mortgage protection: life insurance and disability insurance. Life insurance mortgage protection pays off your mortgage if you pass away, while disability insurance mortgage protection covers your mortgage payments if you become disabled and cannot work. Mortgage protection is a good idea if you're concerned about being able to make your mortgage payments due to unforeseen circumstances. However, before signing up, it's important to understand the terms and conditions of your policy, as some policies may have restrictions on how and when they can be used. Overall, mortgage protection can provide valuable peace of mind and financial security, making it worth considering if you're a homeowner.


What does mortgage protection cover?


Mortgage protection typically covers your mortgage payments if you can't make them due to unexpected circumstances. The specific coverage will depend on the type of policy you have. Life insurance mortgage protection pays off your entire mortgage if you pass away. This means your family won't have to worry about making mortgage payments after you're gone and can instead focus on mourning and rebuilding their lives. Disability insurance mortgage protection, on the other hand, covers your mortgage payments if you become disabled and can't work. This can be a huge relief if you're suddenly unable to earn an income because it can allow you to stay in your home and avoid foreclosure. It's important to note that mortgage protection typically only covers your mortgage payments and not other expenses like utilities, property taxes, or home insurance. However, some policies may offer additional coverage for these expenses, so it's essential to read the fine print and understand what your policy does and does not cover. Overall, mortgage protection can provide valuable financial security and peace of mind, but it's essential to understand your policy's specifics before signing up.


How long does it take to get mortgage protection?


The time it takes to get mortgage protection can vary depending on several factors. If you're getting mortgage protection through your lender when applying for your mortgage, it may only take a few days to get coverage. This is because the lender may already have your information and can quickly assess your eligibility for mortgage protection. However, if you're getting mortgage protection through an insurance company, it may take longer. You'll typically need to apply for coverage, undergo underwriting, and get approved before the policy can go into effect. This process can take anywhere from a few days to several weeks, depending on the insurer and the complexity of your application. Some policies may have waiting periods before coverage begins. For example, a disability insurance mortgage protection policy may require you to be disabled for a certain period of time before.


Do you still have questions about mortgage protection insurance? Please get in contact with our Dublin offices today. We have a team of expert brokers who specialise in mortgage protection. They can assist you with your enquiries and prepare mortgage protection quotes based on your needs.

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