Why choose a Mortgage Protection Plan?
Stay ahead of troubles and secure a stable lifestyle. Your future looks brighter if you feel confident with your choices and decisions today. Keep your family safe from worries by having a mortgage insurance plan. This insurance pays for your mortgage in case of an event, such as death or disability.
If you were to die, would you be 100% certain your family’s financial security would be preserved?
The right Mortgage protection Insurance policy can help you answer all of these questions confidently and give you peace of mind.
What is mortgage protection?
Mortgage protection is in affect a life insurance that states that your bank is the first beneficiary in the event of your death. The life insurance amount covers the mortgage. Any surplus will go to your beneficiaries.
The main benefit of this type of life insurance is that you can have a decreasing rate. Which means as the mortgage is paid off you can insert a clause in the insurance contract that the amount covered decreases by a certain percent each year. This rate is usually the same percentage of the mortgage which is paid off each year.
If you want the surplus to go to a beneficiary to cove taxes and burial costs for example you can choose to leave the life insurance amount and the suplus will be paid to beneficiaries.
Capital which covers your mortgage in the event of your death
The bank is the first beneficiary
A decreasing rate clause can be inserted so the capital decreases on each renewal of the policy in line with mortgage amount
You can have a surplus amount which once mortgage is paid the rest goes to your family
Am I tied into the bank for the life insurance to cover Mortgage?
According to Spanish and European law after 1 year you are entitled to switch your insurance to another provider. You will have to provide 1 months written notice but you can change provider.
The bank may put up your interest rate but only a fraction. Nine times out of ten the increase is much less than the extra cost you are paying your bank for the life insurance.
We can provide a much more competitve rate on this Mortgage Life inurance cover.
Also in event of any changes to the terms or coverage of plan once the mortgage is lower, as brokers we can easily amend the policy so any changes are reflected. By doing this we can also lower the price of the policy. We carry out annual reviews of your policy so that you are not paying more than you need to. This type of service will be very time consuming through a bank and they will not be obliging when doing this service.
What if I have a medical precondition, should I state this ?
In regards medical conditions I have come across policies that are issued by banks which do not mention preconditions to do with your health.
The reason banks do not do this is mainly becuase they are not experts in Life insurance. They also do not want to state anything on the policy which will risk you getting the mortgage. Now this is fine but I am sure problems would arrive if you were to die of a precondition that was not stated on the inicial application. As brokers we throughly go through your history and in the case that you have a health issue, the insurer will apply a small surcharge to the policy. However, by doing this you are assured that if the policy needs to be used you will get the payout in a smooth process.