PPI is the acronym for payment protection insurance (which you may also hear referred to as accident, sickness, unemployment insurance). It is an umbrella term that covers a range of payment protection policies. The policies would pay out if you should find yourself unfit for work through accident or sickness. The policies would also protect you if you should become unemployed by redundancy.
If you stop to think how much you rely on your income each month and what you use it for you will appreciate how important it is to cover your income. You can do this easily by taking out income payment protection insurance. When taking out this policy you can cover so much of your own income each month and this would allow you to continue meeting your entire essential outgoings. It would mean you are not scrimping and scraping or having to decide which bills to pay now or later.

Your income of course pays your mortgage each month and without that income where would you get the money needed to keep the roof over your head? If you have mortgage payment protection behind you then you would have the money needed as you can insure up to a certain amount of your mortgage repayments. This would mean that you could be looking around for work again without having to worry or you can concentrate on recovery and getting back to work.
Of course your loan would have to be kept up with unless you want to see your credit rating plummet or risk having a day in court. Loan payment protection taken as PPI would allow you to do this by insuring the repayments of any credit card or loans.

For this security you have to pay a premium and the premium will vary greatly depending on where you choose to take out your cover. Taking quotes from independent specialists offering payment protection is always cheaper than taking cover alongside the borrowing. For instance if you get a quote from independent specialist British Insurance then you could save as much as 80% on the cost of taking out loan payment protection cover and in the case of mortgage cover around 40%.

You have to read the terms and conditions to find out when the policy would begin and end. Some providers will ask that you are out of work for just 30 days while with others it can be as much as 90 days. Some backdate cover to the first day of you becoming unemployed, so it is always worth checking this when comparing policies. Policies also differ with the ending dates, some providers offer cover that would give you a payment each month for up to 12 months, while others will pay 24 monthly repayments before expiring. You do need to check the key facts of any PPI before rushing into taking it out as there are conditions which must be met before you would be eligible to put in a claim. Again these differ between providers so when comparing be sure to check each individual policies conditions.
   

Do you need mortgage protection insurance UK?

If you have a mortgage then serious consideration needs to be given to what would happen should you suddenly lose your income. A mortgage protection insurance policy (also known as mortgage payment protection insurance or MPPI for short) can be taken out to ensure that if you should come out of work after having an accident, suffering an illness or through unemployment then help towards your mortgage repayments will be given in the form of a monthly tax free amount.
A good quality policy will start to pay out after you have been out of work for 30 days or more and will carry on paying out for up to 12-24 months. This is usually adequate enough time for you to be able to get back to work and on your feet again.

However the premiums on a policy will vary greatly depending on where you choose to purchase your mortgage insurance policy from. The majority of policies that are sold are taken with the high street lender at the time the mortgage is taken but this means that you are probably paying far too much for the premiums and could make huge savings by going with a specialist and standalone provider such as the ethical British Insurance. Many people simply do not realise that they do have an option when it comes to buying a policy and the high street lender of course doesn’t make this known.

The protection insurance sector has earned itself a bad name when in 2005 a super complaint regarding the products was passed to the Office of Fair Trading from the Citizens Advice. This led to an investigation into the products by the Financial Services Authority and many fines were handed out to companies for mis-selling payment protection cover, among them some high street names. As the investigation into the sector continued it was referred to the Competition Commission who is an independent body. Their findings will be completed by Feb 2009 by when it is hoped that changes for the better will be made in the sector.

Among the problems found with the protection insurance industry, were that premiums were often grossly over priced due to the high street lenders having a stranglehold over the sector. Also, consumers were often being given very little information regarding the products at the time of purchase and there was a general lack of understanding of mortgage protection insurance products by the general public.

However, with changes afoot and more positive publicity now slowly coming in to the public arena, consumers are getting savvier when it comes to buying mortgage protection insurance and, also as important, payment protection insurance products are finally being recognised for what valuable cover they provide.

Losing your home is a nightmare that all homeowners are faced with when paying a mortgage over a period of what is often 25 years. Several missed monthly payments would have the lender seeking repossession of your home. Therefore you have to hope that you will not become a statistic of unemployment by way of redundancy, or hope that you do not have to take a long time away from work due to illness or accident. If you want know that mortgage repayments would be secure then you can choose to take out mortgage protection insurance to help protect the roof over your head.

Mortgage protection insurance would provide you with a tax free sum of money to fall back on each month. You would then be able to continue meeting the agreement of your mortgage and not fall into arrears. This income would allow you freedom to find work again if you had become unemployed or give you time to recover. The majority of policies will pay an income for a period of between 12 and 24 months after being incapacitated or unemployed for between 30 and 90 days, depending on the terms set by the provider.

If you choose to go with ethical specialist British Insurance this would be from the 30th day for up to 12-months. Mortgage protection insurance UK policies do have exclusions and it is imperative that you check these against your current circumstances to ensure eligibility.

To start with you have to be working full time in the UK, Channel Islands or Isle of Man. Exclusions which are found in general include being of retirement age when applying, if you are in self-employment or you suffer illness at the time of applying that has re-occurred in the 2 years prior to applying. Different providers can add in others so it is always worth double checking the wording of each protection policy you consider taking out.

Wanting to protect your best interests is only normal, wanting to save money whilst doing so is even better and if you use the internet then cheap mortgage payment protection insurance (MPPI) is only a click away. However in order to get the cheapest quote for the protection you have to shop around and know where to look, the cheapest premiums can only be found by going to an online specialist.

British Insurance is one of the best in the payment protection insurance sector and offer cheap mortgage payment protection insurance without compromising on cover. Getting a quote with them is quick, easy and as simple as choosing the amount you wish to be covered for and your age. The quote is easy to understand as it is based on every £100 of cover you require.

Sadly the majority of people don’t even realise they have the option of shopping around and finding cheap mortgage payment protection insurance and believe that it has to be taken out alongside their mortgage with the high street bank or lender. This is simply not true and can be bought independently as Simon Burgess, Managing Director of the ethical mortgage payment protection insurance provider British Insurance is always pointing out.

It is essential that you go with a specialist provider as this way you not only benefit from cheap mortgage payment protection quotes but also from the experience that a specialist can give the consumer. Mortgage payment protection insurance is taken out in case through an accident, illness or through involuntary unemployment you should find yourself unable to work. The cover when bought correctly will pay out for up to 12-24 months (depending on the provider) giving you a fixed income which enables you to carry on meeting your monthly mortgage repayments.

What Is Mortgage Protection?

If you've ever taken out a loan or some type of hire purchase agreement, you might have been asked if you'd also like payment protection. In this case, your payments are met for a period of time if you're not able to make them yourself because you are unemployed, ill, or if you've had an accident that has kept you from working.

Mortgage protection insurance works on the same principle, but on a larger scale. It makes your mortgage payments for you if you should become ill or injured, or if you become unemployed because of losing your job. This, of course, can provide you great peace of mind during an already difficult situation.

How Does Mortgage Protection Work?

Basically put, if you are unable to make you mortgage payments because of accident or illness, or because of unemployment, you payments are made for you through the insurance. This is similar to car insurance that covers you if you are in a car accident, except that mortgage protection provides the same type of cover for your home.

It doesn't matter whether you lose your job, we become ill, or are involved in an accident that leaves you unable to work. Simply, if you can't work and would be unable to make you mortgage payments otherwise, this insurance makes those payments for you, usually for 12 months and up to 24 months.

If you should need to make a claim, it's pretty simple. If something happens to you that will leave you unable to make your mortgage payments and it's covered in the insurance policy (namely, illness or accident that leaves you unable to work, or unemployment), you should contact your insurer within 120 days of your illness or injury, for example. You provide the insurer the information asked for, and then you should be covered.

Is Mortgage Protection Expensive?

Although it's popularly thought that mortgage protection is expensive, in fact, it's quite reasonable. For example, if you are 30 years old and your monthly mortgage is £800, your cost for the insurance will be £22 a month over your regular mortgage payment. This comes out to about £7,000 over the life of the average 25-year mortgage. This is, indeed, reasonable when you consider what you might face if you don't have it.

To get the best mortgage protection for the best price, use an online mortgage insurance company. Your choices will be greater and you can save up to 40% on the cost in addition to the other benefits looking online gives you, such as ease of comparison between companies.

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