Safeguard Your Home & Loved Ones with Reliable Mortgage Protection
Mortgage Protection Insurance is a specialised type of life insurance designed to repay your mortgage if you pass away before the loan is fully repaid. It ensures that your mortgage balance is cleared, so your family or dependents won’t be burdened with repaying the loan or risk losing the home. Typically, the amount of coverage decreases in line with your outstanding mortgage balance over time.
While mortgage protection is focused on your home loan, life insurance for broader financial protection can ensure your family’s overall needs are met.
In Ireland, mortgage protection is legally required for homebuyers when taking out a mortgage. Lenders insist on it to safeguard their financial interest. However, it is designed for the borrower’s peace of mind as well, ensuring their family will not be left with the debt in case of their death.
Yes, mortgage protection insurance is compulsory in Ireland for most homebuyers. It’s a standard condition set by lenders to approve your mortgage.
It is important to note that you are not obliged to take out the policy from your mortgage provider, and you are encouraged to shop around. An insurance broker, like Smart Financial, can usually help you find the best policy.
There are exceptions to the compulsory nature of mortgage protection:
Mortgage protection covers the death of the policyholder. If the policyholder passes away, the insurance pays off the remaining balance of the mortgage.
To safeguard against income disruption, consider income protection for mortgage continuity if illness or injury prevents you from working.
Mortgage protection policies can sometimes be customised to include additional coverage, such as serious illness or disability cover. These options, however, will increase the policy’s premium. This may also involve extending the term or adjusting coverage to match a change in your mortgage situation.
Aligning your mortgage strategy with long-term financial planning through pensions helps ensure a more stable retirement outlook.
Our financial advisors can help you navigate different options from various insurers to find the best deal. Here’s the process:
We will assess your needs, gather information about your mortgage, and consider your personal circumstances, which include:
We will search for different mortgage protection products from a range of insurers, comparing features, premium amounts, and the level of cover offered.
Our financial advisors will present you with the best options based on your needs and budget that include:
Once you’ve chosen a suitable policy, an advisor will help you complete the mortgage protection application form. This will include:
Once the application form and any required medical information are completed, we will submit the application to the insurance company on your behalf and ensure all documentation is properly submitted.
Once you accept the policy, it needs to be assigned to your mortgage lender. This means that in the event of your death, the insurer will pay off the mortgage directly to the lender.
You can also explore investment strategies to complement your mortgage, building wealth while managing your financial obligations.
When taking out a mortgage with another person, such as a spouse or partner, you may want to ensure that the mortgage protection insurance covers both parties. There are two main types of mortgage protection for multiple borrowers: Joint Protection and Dual Protection. Here’s how each works:
Joint mortgage protection is a single policy that covers two people (usually spouses or partners) for the same mortgage. It is designed to pay out once on the death of either policyholder during the mortgage term. After this payout, the policy ends.
Pros:
– Lower Premiums: Since there is only one payout, joint policies tend to have lower premiums compared to dual policies.
– Simplified Coverage: You manage just one policy for both people, making it administratively easier.
Cons:
– Single Payout: If both policyholders die (e.g., in an accident), the policy still only pays out once, meaning the second death offers no additional benefit.
Dual mortgage protection involves two separate life insurance policies under one plan. Each individual has their own separate policy, meaning it provides two potential payouts, one for each person covered.
Pros:
– Two Payouts: In the unfortunate event that both policyholders die (whether simultaneously or at different times), both policies pay out, offering enhanced protection for dependents or estates.
– Flexible Benefits: Each person has their own policy, which can be useful for covering other debts or leaving a larger inheritance.
Cons:
– Higher Premiums: Because two payouts are possible, premiums for dual mortgage protection are higher than for joint mortgage protection.
Our financial advisors have access to a wide range of market options.
We help customers compare policies across multiple insurers.
Help navigate all life insurance options (term policies, serious illness cover, pension-linked products).
Our team supports clients throughout the entire process, from application to claims.
1. Steps for Claiming: In the event of the policyholder’s death, the family or estate must notify the insurance provider. The process typically involves submitting:
2. Claim Processing Time: Claims are generally processed within a few weeks after all required documentation is submitted, though complex claims may take longer.
3. If Your Claim Is Denied: If a claim is denied, you can appeal the decision with your insurer or seek help from the Financial Services and Pensions Ombudsman (FSPO).
1. Decreasing Term Insurance: This is the most common form of mortgage protection. The insurance cover decreases over time, in line with the outstanding balance of your mortgage. It is generally the most affordable option, as the risk to the insurer reduces as your mortgage is paid off.
2. Level Term Insurance: This type of policy provides a fixed amount of cover throughout the term of the policy. Unlike decreasing term insurance, the payout remains constant. It’s usually more expensive and can be more suitable for those who want to leave behind an additional lump sum for their family.
3. Serious Illness Cover: Can be added as a rider to your mortgage protection policy to cover the mortgage if you are diagnosed with a critical illness.
The best place to start is by contacting one of our financial advisors who will provide you with personalised advice and compare your policy with others in the market to find you the best policy that is suited to you by checking:
1. Premium amounts.
2. Coverage amount.
3. Terms and conditions (e.g., exclusions for pre-existing conditions).
4. Flexibility for switching or adjusting policies if you refinance your mortgage.
5. Benefits that matter most to you (e.g., serious illness coverage, flexibility).
Get help from Smart Financial knowledgeable Mortgage Protection advisers to discover coverage that meets your requirements.
Monday to Friday: 9:00am – 5:00pm
Weekends and Bank Holidays: Closed
In Ireland the cost of mortgage protection varies based on several factors:
Mortgage Amount: The larger your mortgage, the more expensive the policy will be.
1. Transferring Mortgage Protection: Yes, you can transfer mortgage protection to a new provider when switching your mortgage. This is called assigning the policy to the new lender.
2. What to Consider: When switching policies, review:
– Whether you can get better rates from a new provider.
– Any penalties or fees for cancelling your old policy.
– Ensuring there’s no gap in your coverage during the switch.
We recommend contacting a financial advisor when considering the above.
Mortgage protection insurance is not tax-deductible in Ireland. However, if you have a life insurance policy or an additional insurance product that includes your mortgage, you should check with a financial advisor if there are any specific tax advantages you can take.
