If
you had an accident, fell sick or were to be
made involuntary redundant (unemployed) you
might struggle to meet your monthly mortgage
and other commitments. The result would be very
onerous as mortgage
arrears can lead to repossession and give
you a poor credit history. To protect yourself
with Accident
Sickness and Unemployment
insurance also known as ASU or mortgage payment
protection insurance, it may help you for up
to one or two years until you are able to return
to work.
There
is a good chance that you will require the protection
offered by this type of policy throughout your
working life especially during the time you
have an outstanding mortgage liability. depending
on the provider of the policy it may be possible
that the cover could commence after a 4 week
period (known as the deferred period) However
the premium that would be payable would be more
expensive than a policy with a longer deferred
period.
You
may just take out the accident and sickness
parts of the policy for example if you were
self employed then this would be more applicable
to meet your needs. You can also place a partner
on the policy at a split percentage of the monthly
pay out depending on what they earn compared
with your earnings.
A
brief outline of the policy benefits generally
as follows.
You must have been working generally full time
for at least six months. And not claimed recently
and not know of any pending redundancies. The
policy can only be valid when you have a mortgage
in place and will be calculated in relation
to your monthly mortgage payments. Past accidents,
injuries or illness should be notified to the
insurer. You should check the specific product
providers policy documentation for an explanation
of the level of benefit and terms and conditions
that apply as these may differ between providers.
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