One of the greatest fears of redundancy is the fact that you would not be able to pay your mortgage or any of the debts you have incurred. If you cannot pay your mortgage, chances are that you might lose your home. It would there be wise to provide for the loss of income by adding redundancy mortgage protection. One of the ways in which to prevent this is to have redundancy mortgage protection added to the insurance policy of your bond. This will ensure that you are able to meet the payments of the bond at the time of no income.
There are a few methods in which this can be achieved:
- You can visit a website that would give you the options you need. These websites usually give you the option of getting quotes from different companies and compiling quotes for you. This way you are able to compare pricing without having to browse from one website to another.
- An insurance broker could also be of great help. This is even better as they are able to give you comparative costs as well, but can also explain to you the intricacies of the different insurance types.
The mortgage insurance can include the redundancy policy or you could add it on to the insurance at a later stage. The income loss policy is not the same as the life insurance policy. It is important that you:
- Sit down with the lender, either at the start when you add the mortgage insurance and the life insurance on the loan, or at a later stage.
- This is where you would need to add the mortgage protection for when you are made redundant. Many people do not think about this aspect and are often caught unawares, and have to give up their homes as a result of non-payment.
- The options for this type of policy are:
- Income protection: The income protection policies can be a separate policy from the mortgage insurance and the life insurance.
- It is also called the mortgage protection policy and the broker or the website you are using could help with calculating life insurance as well as the income protection policy.
- This would mean that you do not have to pay separate premiums. If it is added at a later stage you will have to pay separate premiums, unless your lender can arrange for a combined premium. Banks are usually able to do so.
With all the different policies available, one has the tendency not to think about the redundancy mortgage protection plan. You do, however, have ample time to add it on once the mortgage loan and life insurance is in place. The difficulty is just that you would then have to pay the premium separately. This is not ideal, but it would ensure that you do have insurance to cover your loss of income. If your bond is with a bank, they might be able to assist you with an inclusive premium.