Do you need Mortgage Payment Protection?

How would you manage if you couldn't pay the mortgage? If you lost your job, fell seriously ill or had an accident? If you're self-employed how would you pay the mortgage if you were unable to work?

And if you think the unexpected always happens to someone else, think again!

Every two minutes someone is diagnosed with cancer in the UK. (CancerStats Key Facts – Cancer Research UK July 2010)

More than 1 in 3 people will develop some form of cancer during their lifetime. (CancerStats Key Facts – Cancer Research UK July 2010)

Heart and circulatory disease is the UK's single biggest killer, over one in three people die from it. Every six minutes someone dies from a heart attack. (www.bhf.org.uk)

TNS Omnibus found that 32% of people made redundant would fail to meet their current living expenses in the first month, with one in six defaulting immediately. Less than half (43%) of working adults questioned had sufficient funds in place to survive more than three months. (Credit Action Debt Facts & Figures – February 2010)

How long could you manage without protection?

Very few of us have the financial means to cover living costs with no income. Ask yourself these questions:

• How long would your savings last if you were out of work for any length of time?
• If you were made redundant how much would your employer pay you?
• If you're self-employed how long could you pay the bills and the mortgage if you are too ill to work?

And don't forget your home may be repossessed if you can't make your mortgage repayments.

Shocking stuff if you've not considered it before. But these issues shouldn't keep you awake at night if you protect your mortgage with helpucover Mortgage Insurance.

Social Security benefits - the uncomfortable truth

If you earn on average £95.00 or more per week, your Statutory Sick pay entitlement is only £79.15 per week. Could you and your family survive on £342.98 a month?

• No mortgage assistance is available for the first 3 months of unemployment
• No assistance towards the portion of your mortgage that exceeds £200,000
• No assistance if your partner works more than 24 hours a week
• There is limited financial help through the State Benefit System (Income Support for Mortgage Interest ISMI) but it only applies to Mortgage Interest, not Capital Repayments or other mortgage related out-goings such as insurance premiums
• ISMI is only paid at the Standard Rate, which may not match the rate your Mortgage Provider is charging.
• ISMI is means tested, which means there isn't a guarantee it will be paid.

Unemployment - more shocking facts

• 381 people everyday of the year will be declared insolvent or bankrupt. This is equivalent to 1 person every 52 seconds during the working day. (Credit Action Debt Facts & Figures – September 2010)
• 152,000 people (1,666 a day) reported they had become redundant between April and June 2010. (Credit Action Debt Facts & Figures – September 2010)
• The number of unemployed people was 2.46 million in the three months to June 2010. (Office for National Statistics – Labour Market Statistics August 2010)
• The average length of a claim for Unemployment is 168 days (ABI - September 2009)

All the protection you need:

• Cover available for up to £2,000 a month for a year, or 50% of your gross monthly income, whichever is less.
• Benefits paid up to 6 or 12 months
• Paid direct to you in addition to any other benefits (i.e. Statutory Sick Pay)
• Personalised quotes whatever your circumstances - up to age 65
• Range of cover options, no matter if you're employed or self-employed
• Benefits are payable after 30 days
• Typical monthly premium for £700 monthly benefit is £23.87*
• Cost per £100 of cover is £3.41*

* Based on Accident, Sickness & Unemployment cover for someone aged 35, non-smoker, Back to day 1 cover, 12 month benefit.

There are other providers of Payment Protection Insurance and other products designed to protect you against loss of income. For impartial information about insurance, please visit the website at www.moneyadviceservice.org.uk

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