Mortgage Payment Protection Cover
i want to take out a re-mortgage with payment protection just in case
C&G have given a quote with Payment Protection Plus at £15 a month but also recommended a Life Assurance for the length of the
mortgage ( 20 years)
what's the difference ? ...i'm guessing PPP is for 12 months only ?????
is it necessary to have both ?
could i get away with life assurance only ?
Life assurance pays out when you die. You will never gain any benefit
from life assurance - it is of interest only if you have dependants that
you want to look after after your death.
Payment payment protection will pay out if you can't meet mortgage
payments IF the conditions of the insurance policy are met (e.g.,
redundancy, critical illness). The conditions vary with the insurer and
are likely to be stringent (i.e., it is usually difficult to make a
claim) especially if your income is not secure (e.g., you are
self-employed). Premiums tend to be very high.
My opinion:
1) Shop around for competitive cover if you need it. It is _very_
unlikely that the mortgage comes with a competitive insurance quote.
2) Life assurance is worthwhile if you have family to support, else
forget about it.
3) Payment protection is a waste of time. Use spare cash to reduce debt,
save into an ISA or make over-payments on the mortgage.