Help keep the family home
A mortgage protection payment can help your loved ones deal with the outstanding mortgage rather than having to meet the debt without you.
Mortgage Protection
Help protect the home your family depends on
Mortgage Protection Insurance is designed to provide a lump-sum payment if you die during the policy term, helping your loved ones deal with the outstanding mortgage on your home.
Protect more than bricks and mortar
Mortgage protection can help your family remain
financially secure in the home you have built together.
Protect the mortgage
Cover can be arranged around the outstanding debt on your home.
Protect your loved ones
Help reduce the mortgage burden your family could otherwise face if you die.
Match your mortgage term
The policy term can be set around the length of time remaining on your mortgage.
Understanding the cover
What is Mortgage Protection Insurance?
Mortgage Protection is a form of life insurance designed with the outstanding debt on your home in mind.
Life insurance built around your mortgage
Depending on the type of mortgage you have, protection can generally be arranged using either Level Term or Decreasing Term Life Insurance.
Both are designed to provide financial protection against the mortgage debt if you die while the policy is in force.
Match the cover to your mortgage
The policy term will normally be considered alongside the remaining length of your mortgage so the protection can remain in place for the period you need it.
Why consider Mortgage Protection?
Your mortgage may be your family's biggest monthly commitment
If one person's income disappears, meeting the mortgage can become much more difficult. Protection is designed to reduce that financial risk.
Reduce a major financial burden
Mortgage payments are often one of the largest regular household costs, making them an important commitment to consider when arranging protection.
Give your loved ones protection
Putting cover in place can help prevent the responsibility for the mortgage falling entirely on a partner or dependants.
Types of Mortgage Protection
Two different ways to protect your mortgage
The structure of your mortgage can influence which type of life insurance may be appropriate.
01
Decreasing Term Life Insurance
The amount of cover reduces over time, designed to broadly follow the falling balance of a repayment mortgage.
Commonly used with repayment mortgages
02
Level Term Life Insurance
The amount of cover remains fixed throughout the policy term rather than reducing over time.
Commonly used with interest-only mortgages
Choosing the structure
Level or decreasing cover?
The difference is largely about whether the amount insured stays the same or reduces during the life of the policy.
Lotus Life Review can help you consider your mortgage type, remaining balance and other financial needs when reviewing the options.
Decreasing
The potential payout reduces during the policy term, typically alongside a repayment mortgage balance.
Level
The insured amount remains fixed for the duration of the agreed policy term.
Policy term
The length of protection can be considered alongside the remaining term of your mortgage.
Cover amount
The starting level of protection can be arranged with your mortgage balance and wider needs in mind.
Illustrative example
Beginning
£300k
Later in term
↓
Decreasing cover
Designed to reduce alongside a repayment mortgage
For example, a decreasing term policy could begin with £300,000 of protection to reflect the original mortgage balance.
As mortgage repayments reduce the outstanding debt, the insured amount is also designed to decrease over the policy term.
The exact relationship between the mortgage balance and insurance benefit will depend on the policy terms.
More than the mortgage
Level cover can also leave additional financial support
A Level Term policy can be arranged for more than the mortgage balance if you want the potential payment to help with other household expenses as well.
Household bills
Additional cover could provide money towards ongoing household and utility costs.
Childcare costs
A larger amount of protection could help your family meet childcare expenses.
Everyday living costs
Additional protection could provide financial support beyond simply repaying the mortgage.
Additional protection
You may also be able to add Critical Illness Cover
Critical Illness Cover can sometimes be combined with life insurance to provide a payment following diagnosis of a qualifying critical illness.
That payment could help you continue dealing with the mortgage if serious illness affects your ability to work.
Explore Critical Illness CoverUnderstand how combined cover pays out
Where Life Insurance and Critical Illness Cover are combined within a policy, the policy may only provide one payment. For example, if a qualifying critical illness claim is paid, the life cover may then end. Always check the specific terms of the policy you are considering.
Protect your home
Get a Mortgage Protection quote
Tell Lotus Life Review a little about your mortgage and the protection you are looking for to start exploring your options.
Would your family be able to manage the mortgage without you?
Speak to Lotus Life Review about protecting your mortgage and the home your family depends on.