Mortgage Protection Frequestly Asked Questions

Mortgage protection insurance is a life insurance policy designed to clear the balance on a mortgage account in the event of the death of the mortgage account holder/s. As one of Ireland's leading mortgage protection advisers, we have negotiated a discount of 16% below the lowest quotes in the market which equates to almost 5 years free cover!


What is mortgage protection insurance?
Mortgage protection insurance is a life insurance policy designed to clear the balance owing on a mortgage, in the event of the death of the person who takes out the mortgage, or in the the case of a joint mortgage, in the event of the first death
What is the difference between mortgage protection insurance and life insurance?

As noted above a mortgage protection insurance is a special form of Life Insurance used when somebody is taking out a mortgage.

Mortgage Protection Insurance is a life insurance policy specifically designed to pay off the balance outstanding on your mortgage. The balance on your mortgage reduces over time and the mortgage protection policy is designed to clear the outstanding balance.

The principal difference between a mortgage protection insurance policy and typical term life insurance is that the the amount insured does not reduce in a term life insurance policy.

Example comparing benefits of a term life Insurance policy with a mortgage protection policy.

Based on a €200,000 mortgage over 30 years at 3.5% interest

Point in Time

Life Insurance pay out

Mortgage protection policy pay out

End of year 1

€200,000

€196,000

End of year 5

€200,000

€179,000

End of  year 10

€200,000

€154,000

End of year 20

€200,000

€90,000

End of year 25

€200,000

€49,000

 

 

The above table illustrates the difference in payouts under both policy types. Mortgage protection is cheaper than straight life insurance because the potential payout is less.
However it is worth noting than in many instances, the difference in price is very small when comparing both types of cover, especially for young policy  holders.

Why are banks more expensive for mortgage protection insurance?

Banks provide a range of services to customers including their core product, mortgages. Banks are not insurance companies ,so when they are selling a mortgage they also use this opportunity to provide other services, including home insurance and mortgage protection insurance.

Unlike mortgages.ie who act as an intermediary and who offer and advise on the best  products and prices from a range of lenders and life companies, banks use just one life insurance company when it comes to life insurance or mortgage protection.


The major mortgage lenders in Ireland are as follows:

  • Bank Of Ireland
  • AIB
  • Ulster Bank
  • KBC
  • permanenttsb


With the exception of Bank of Ireland, all the other banks are tied to Irish Life Insurance for life insurance and mortgage protection.
Bank of Ireland uses its subsidiary New Ireland insurance for life insurance and mortgage protection.

On the other hand we search the Life Insurance Market in real time for the best deal and offer exclusive discounts to our customers, typically in region of 15% to 20% lower than available if you use a bank.

For this reason our discounted quotes will always result in in better value cover than you will get through dealing with your bank.


 

Explain how our mortgage protection calculator works?
Our Mortgage protection Insurance calculator works by searching all the major Life Insurance Companies for their mortgage protection quotes for the values you have input into the calculator. We display the quotes returned and above this we display our best  price after taking account of special discounts available to us which we pass on to you in full.
The calculator will also give you discounted figures for life insurance and serious illness. Our mortgage protection advisers will discuss the merits of particular products and insurance companies with you when assisting you in arriving at a preferred choice.
Do I need to take out Mortgage protection with my mortgage lender?

Absolutely not - you are free to seek independent advice and deal with the best provider.

We will always provide better value than the mortgage protection quote you receive from your lender.

We will provide you with the best available product from Ireland's leading Life Insurance Companies and you will save money as a result.

We receive calls every day from customers who were sold expensive mortgage protection policies through their lenders and who want to save some money and ensure that they still have adequate protection in place.

Do you provide mortgage protection quotes for all the life insurance companies?

Mortgages.ie provides you with the best products from Ireland's leading Life Insurance Companies. We analyse your needs and search the market to find the lowest price policy that matches your needs. We then apply a range of discounts of up to 16% off the lowest price in the market to ensure you get the best value.

We provide clear advice on all the various options open to you.

Our partners account for almost 100% of all mortgage protection business written in Ireland and we select the best products from their range, for you.

Why do I need mortgage protection?

Under the Consumer Credit Act 1995 ( as amended) a Mortgage lender is obliged to ensure that a Life insurance policy is in place to cover the balance due on a mortgage, in the event of the death of a borrower, or in the case of a joint mortgage, in the event of the death of one of the borrowers.

The principal exceptions to these requirements are:

  • Where the mortgage is  taken out in respect of a property that is not the principal private residence, no life insurance is necessary .
  • No mortgage protection is required where the borrower is over 50 at time of Loan approval.
  • It is not mandatory where the premium is excessive due to medical issues.

Important note. The fact that mortgage protection is not required under the exceptions noted above, should not stop you from seriously considering taking out a policy in these circumstances.It is also at the lender's discretion wheteher or not to insist on a mortgage protection policy as a condition of a mortgage.
For further information on the consumer protection Act please click Here

How do I arrange a better value mortgage protection policy?

The steps involved in switching to a cheaper policy are as follows.

1. Check the level of your existing cover and how much you are paying.
2. Compare your current cost with our best offering by using our mortgage protection calculator.
3. We will go through the alternative quotes with you.
4. We will arrange for the completion of the paperwork and issue of your new cheaper policy.
5. Only cancel you existing policy after the new policy has issued

What happens if I stop paying my mortgage protection policy?

Please never stop paying your mortgage protection policy.

It is a specific condition of your mortgage and you will be in breach of your mortgage agreement if you let the policy lapse.
If you are having difficulties meeting your mortgage protection payment, you should advise your lender as soon as possible.

The main reason for continuing to pay your mortgage protection is that If you die and the policy has lapsed, your dependants may not be in a position to afford the mortgage repayments and they could lose the family home

How much does mortgage protection cost?

Use our mortgage protection calculator to calculate the cost of cover.
The good news is that mortgage protection insurance is surprisingly cheap, principally because the balance on cover reduces over the term ( in line with your mortgage) and more importantly the risk off of passing way during the mortgage term is low.
 
Mortgage protection costs are fixed for the duration of the policy.


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Free cover offer explained!
Mortgages.ie and lIfeinsurance.ie have special discount facilities with our Life insurance Companies..

We havel discounts of up to 16% off the lowest mortgage  protection quote available in the market and 10% off serious illness cover on Zurich serious illness policies. We also currently ( October 2019) have a 205 discount with one insurer on policies with a value greater than €300.000

Our special discounts are available throughout the term of your policy and one way of looking on it as that you effectively get five years free cover over a typical mortgage term of 30 years.




Which Life Insurance Companies do we deal with
Here at Mortgages.ie we are authorised intermediarie of all the major providers of Life Insurance and Mortgage Protection Insurance in Ireland.  We estimate that our partners cover over 95% of all Mortgage Protection Market  in Ireland. They are all household names with high credit ratings. 

Irish Life 
Aviva
Zurich
New Ireland
Friends First
Royal London
When should I arrange my mortgage protection insurance
Once you have identified a property you wish to buy and you know how much your mortgage is going to be you should contact us to arrange your mortgage protection insurance. Your lender may give you a quote but we will always be better value than a lender. 
Arranging cover early in the process is helpful in case there are any medical queries that need to be attended to. We can arrange mortgage protection approval and then hold the approval for three months in anticipation of you drawing down your mortgage. If the time moves over three months we may require a simple health declaration to confirm that there have been no changes.to your health status during the period.
What Insurance will i need when taking out a mortgage.
The two essential insurances are :
  • Mortgage protection Insurance or life Insurance policy for the total amount of the mortgage and a term at least equal to the mortgage term
  • Home Insurance to protect your house against fire and other perils.
Popular additional Insurance
  • Income protection insurance. This form of insurance pays out up to 75% of your income in the event you are unable to work due to illness or injury. The insurance continues until you return to work or your retirement age.