The most common types of policy are:
- Life Assurance – is an insurance policy which pays out a lump sum should you die prematurely. This can then be used by your partner to pay off the mortgage.
- Level Term – This is a policy which pays out a fixed amount of money in the event of your death. The term is usually set to match the term of your mortgage.
- Decreasing Term – This is a policy which reduces in value in line with your mortgage.
- Critical Illness – This type of policy pays out a lump sum if you were to be diagnosed with a critical illness.
- Income Protection – This type of policy pays a monthly amount should you be unable to work, for instance, have an accident or become ill.
- Mortgage Payment Protection (MPPI) – This type of policy pays out a monthly amount for typically a 12 month period if, for instance, you have an accident, become ill, become unemployed or are made redundant.
- Buildings & Contents – Buildings insurance is a pre-requisite to getting a mortgage. It is advisable to also have your contents insured in the event of any damage. By taking out a Buildings & Contents insurance policy you are protecting yourself should anything happen, for instance, fire, flooding, etc.
