Glossary - Mortgage Protection Life Cover

Mortgage Protection Life Cover is Mortgage cover against the event of death.
Life cover is an insurance cover that covers the risk of the insured for death.
Having mortgage protection life cover would mean that if the insured party was to die the mortgage would be paid off entirely.
This life cover policy ensures that any one closely related to the deceased such as spouse would not have the extra burden of paying a mortgage.

Example: UK Mortgage Protection Life Cover
Life insurance cover is a decreasing term life insurance, which is designed to protect a mortgage loan. Over time the policy and the level of cover declines, this means that it reflects the reducing size of the mortgage so you would only be paying for the amount of cover that is required. This mortgage life insurance has no cash in value, so should you stop paying premiums then there would be no pay out in the future. As this type of cover runs for the duration of a mortgage should the time come when the mortgage is repaid then this cover would cease, only valid claims made during the mortgage term would see a payout.

Useful Tip
Most mortgage lenders insist there be some kind of mortgage protection taken out before they grant you the mortgage loan. You will find plenty of competitive rates on the market. Mortgage protection cover could cost as little as £5 a month.

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