The Question
I am a scaffolder and I’m about to purchase my first home. I’m unsure what type of insurance to take out to cover my mortgage repayments if I am ever unable to work for any reason. What would you recommend? I live alone and have no dependants.
Darren’s Answer
Protection comes in four main products, namely Life Cover, Critical Illness Cover, Income Protection and Family Income Benefit.
Our article series on protection types goes into these products in more detail but to summarise briefly:
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Life Cover
In the event of your death, this will pay a lump sum and is designed to pay off your mortgage balance.
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Critical Illness Cover
Will pay a lump sum if you are diagnosed with a critical illness, such as cancer, heart attack, stroke and can be used to repay the mortgage or make enhancements to your standard of living.
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Income Protection
As you have mentioned, this pays a monthly tax-free sum to help maintain your outgoings and lifestyle.
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Family Income Benefit
Pays a monthly income or lump sum but generally taken as a monthly amount to replace a household’s lost income.
All protection products have additional features so we recommend discussing these with an expert adviser, who can provide options based on your needs, budget and circumstances.
You have worked hard to own your home, and these policies will ensure you can keep it. Given your occupation, you will need to seek advice on the above to ensure you are covered, should the worst happen.
Please speak to a whole of market broker who can provide the best recommendation for your circumstances.
Meet our expert…
Darren Polson is head of mortgage operations at Aberdein Considine. He has been writing a regular column for What Mortgage for over two years and is now here to answer YOUR questions.
If you have a question for Darren please email kate.saines@emap.com or leave a message in the comments below.
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