Mortgage protection is a form of protection that you will need when you purchase a property. It is usually part of the mortgage application process.

When you take out a mortgage you will be required to have protection so that, if you die before the mortgage is paid off your family home will be secure. 

You will need to insure your mortgage for the loan amount, this is the sum assured. The term of your mortgage protection policy will usually coincide with your mortgage term so that you will be protected until the mortgage is paid off.

MortgageOne can find you the best mortgage protection insurance for your needs, whether you are a first time buyer or a home mover. We are with you at each step of the mortgage protection application process to advise you.

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What is mortgage protection insurance?

Mortgage protection insurance is a specific type of life insurance that is tied to your mortgage and will pay the remaining balance on your mortgage to the lender if you die during its term.

Mortgage protection is typically purchased as reducing term cover. This means that the amount of cover, the sum assured, offered by the policy reduces in line with your mortgage balance over time. For this reason, mortgage protection is usually cheaper than life insurance.

It is possible to purchase level cover mortgage protection insurance which means that the amount of cover that you choose when taking out the policy will remain the same over time. If you die, your mortgage balance will be paid off and any remaining balance will be paid to your estate.

Who needs mortgage protection?

If you are buying a home, you will need mortgage protection insurance. Lenders are legally required to ensure that you have mortgage protection in place before giving you a loan, with some exceptions. 

If you are unable to obtain mortgage protection cover due to your age, health, or occupation you may not be required to have this cover. 

If you already have a life insurance policy with sufficient cover you also may not be required to have mortgage protection. 

Mortgage protection may not be required when purchasing a property that is not your principal private residence or for an investment property.

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What does mortgage protection cover?

The amount of cover that the policy will provide, the sum assured, will usually be the same as your mortgage amount and will be paid to your lender should you die in order to pay the outstanding balance on the mortgage.

Single or joint mortgage protection insurance?

Single life mortgage protection will cover the life of one person. If you and your spouse or partner have a joint mortgage, you will need joint mortgage protection that covers two lives.

Joint life mortgage protection insurance generally covers two lives on a first death basis. This means that if one spouse dies, the policy pays a benefit and cover then ceases.

Dual life mortgage protection insurance can cover the lives of both spouses with the mortgage cleared on the death of the first spouse and, should the second spouse die, a second benefit paid.

Conversion option

It is possible to choose a conversion option when purchasing mortgage protection. 

Convertible mortgage protection allows you to make changes to your mortgage protection policy during its term without having to purchase a new policy and provide new medical information. 

You may choose to extend the term of your policy, or to increase the cover amount, depending on the terms of your policy.

Serious illness cover

You can purchase serious illness cover with your mortgage protection policy. This is an additional form of protection which pays a lump sum if you are diagnosed with a serious illness during the term of the policy.

How much does mortgage protection cost?

The monthly premium for mortgage protection insurance is not a standard price as several individual factors will affect the price you pay.

Your mortgage protection premium will be affected by:

The sum assured will usually be your loan amount. If you have a higher mortgage, you will pay a higher premium for mortgage protection.

If your mortgage term is longer, you will pay more for mortgage protection insurance. Your mortgage protection term must match that of your loan term.

If you have joint mortgage protection insurance, this will cost a little more than single cover. 

Dual protection may cost more than joint cover, although this is not always the case even though dual cover offers a higher level of protection.

You will pay a lower premium for mortgage protection insurance if you purchase it when you are younger. 

When you see very low monthly quotes for mortgage protection advertised, it is usually based on someone purchasing mortgage protection in their 20’s.

Smoking, vaping, or use of nicotine replacement products will all increase your mortgage protection premium.

If you have not smoked or vaped for one year, you may be able to purchase mortgage protection insurance at non smoker rates.

You will be asked about your current and previous health when purchasing mortgage protection.

If you have, or had historically had, a health issue it may be worth purchasing mortgage protection insurance through an insurance specialist, such as MortgageOne, as they will be able to advise you and get you the right protection for your needs.

If you choose additional benefits, such as a conversion option, or additional serious illness cover, you will pay a higher monthly premium for mortgage protection insurance.

Choosing an additional benefit like a conversion option may save you money in the long run as without this option, you may have to purchase a new mortgage protection policy if you switch your mortgage or move house.

Likewise, adding serious illness cover will cost more in the short term but it is an invaluable form of protection and it is usually cheaper to add it to a mortgage protection or life insurance policy than purchasing standalone cover.

Mortgage protection calculator

Use our mortgage protection calculator to see how much you could save on mortgage protection each month.

Our insurance advisors are also on hand if you would like to discuss your mortgage protection application and compare policy prices and features in more depth.

Mortgage protection FAQ

Whereas life insurance pays a benefit in the form of a lump sum if you die during the term of the policy which is paid to your beneficiaries, mortgage protection insurance is usually tied to your mortgage and pays the remaining balance to your mortgage lender.

Usually mortgage protection insurance only offers protection for the term of your mortgage loan and the amount of cover reduces over time as your loan is repaid. This makes mortgage protection a more affordable form of cover in most cases.

Although mortgage protection is sometimes advertised at very low monthly premiums, most people will pay more for their plan. The quote you will receive on applying for mortgage protection depends on the factors above.

It is best to work with an insurance expert and purchase a tailored plan that is right for your needs as this will offer the level of protection you need.

No, and it is a good idea to shop around to get a variety of quotes before purchasing mortgage protection.

MortgageOne can help you to get several quotes for mortgage protection without having to fill out numerous applications so that you can compare prices and benefits of various policies.

If you switch mortgage lender, or you move home, it may be possible to get your mortgage protection policy assigned to another lender or you may have to purchase a new mortgage protection policy.

If you arrange your policy through an insurance broker such as MortgageOne then they may be able to assist you with this process.

It can take time for a mortgage protection application to be processed and it is possible that you may have to provide medical reports or exams that may take time.

It is best to allow four to six weeks before your anticipated mortgage drawdown date to ensure that you are fully protected by your mortgage protection policy on the day.

Get expert mortgage protection advice today

MortgageOne can help you to find the best mortgage protection insurance policy so that you are protected when you purchase your home. You will have peace of mind that your home is secure for your family should the worst happen.

Use our mortgage protection calculator to find the best deal for you or leave your details and you can speak to a Qualified Financial Advisor about your mortgage protection application.