Insurance

What insurances do I need to support my mortgage?

No insurances are a condition of your mortgage, but they are essential to protect yourself against possible eventualities. However some lenders will make an offer subject to you taking out insurances with themselves. If you decline to take their insurance of which ever reason, they will charge a penalty.

Buildings Insurance.

When purchasing a property, your solicitor will confirm on behalf of the lender that buildings insurance is in place and is adequate to cover to cost of damage to the building itself. If your buildings insurance is not kept in line with rebuild costs, this could result in failure of the insurance company paying out on a claim in full.

They will also advise you that this insurance has to be in place at the change of contracts stage as you are bound by that contract to purchase that property.

If purchasing a lease hold property, the buildings insurance is generally through the management company along with the other tenants within the property.

Contents Insurance

This is usually a more personalised insurance which is based on the contents of your home. Much insurance now can be tailor made to your needs, which means maximum cover can be given on articles of greater importance and you are not paying for articles that you don’t possess.

These are the insurances that protect your home and contents. There are also insurances that you should consider to protect you and your family from loosing your home through accident, sickness and unemployment Your adviser will inform you of these and will be happy to provide you with costings. These insurances should be an important part of your budgeting.

Life Insurance

This a life policy that will pay off the mortgage should a borrower die within the term of the mortgage. The lives of all borrowers should be covered for at least the value of the mortgage. All clients can be advised in this respect.

Accident, Sickness and Unemployment (ASU)

This form of insurance provides cover for a fixed period, normally for 6, 12, or 24 months to the value of the mortgage commitment or more in the event of you being unable to work because of an accident, illness or if you loose you job. Each borrower must be insured in their own right to qualify for their benefit.

Critical Illness

This type of insurance protects against the financial effect of suffering a critical or terminal illness. A claim for this cover can be used for any purpose, such as paying off a mortgage, medical costs or any other need at the time.