Glad you stopped by! If you are here you either are bored in work in which case you must be really bored to keep reading or you are in the process of getting a Mortgage and need Mortgage protection.
2nd reason you might be here, is you already have a Mortgage and you want to switch Mortgage Protection.
Let’s start with getting your Mortgage and you need Mortgage Protection. Banks are great aren’t they. They are a one stop shop for everything. However that doesn’t make them great value for insurance. Yes they might be good for your Mortgage but for insurance it’s a big fat no no.
Why? Glad you asked. AIB, Ulster Bank, EBS and PTSB all only deal with one insurance company and that’s Irish Life. This means they can only offer you advice and prices from Irish Life. Bank Of Ireland only deal with their own insurance company.
While other insurance companies have upgraded their Mortgage Protection policies to include more freebies like Dual life cover Irish Life have not.
Not a big deal you think? Let me explain the difference. Joint Lives (Irish Life) this means there are two people insured but only one pay-out. Usually on the first death. Dual Lives (most other companies) means there are two people insured and two pay-outs -one on the first and one on the second. This is included free.
Should you included Serious Illness Cover on your Mortgage Protection?
Quick answer: No but let me explain. Serious illness cover is an extremely important cover to have. However it is expensive. Most people starting off anyway will not be able to cover the full Mortgage amount. When a policy is assigned to a bank, they own all primary benefits on that policy so if you don’t have the full amount you could be seriously ill and still have a substantial mortgage to pay every month. I’ll show you an example.
We will keep it simple.
E.G.1 John and Mary have a Mortgage of €250,000. It is protected with for Life Cover of €250k and Illness cover of €250k. John becomes seriously ill and claims the €250k it pays directly to the bank and Mortgage is cleared. No real problems.
E.G.2 John and Mary have a Mortgage of €250,000. It is protected with for Life Cover of €250k and Illness cover of €50k. John becomes seriously ill and claims the €50k it pays directly to the bank and the Mortgage is reduced by €50k. Now John is seriously ill and still owes the bank €200k.
In example two if John had that €50k on a policy separate to his bank policy it would have paid directly to him and he can decide what to do with it! But the bank won’t tell you that!
How to assign you Mortgage Protection Policy:
1. Arrange your policy ideally through and broker-like us we explain why below.
2. Complete your deed of assignment-This comes as part of your legal pack with your solicitor if it’s a new mortgage or re-mortgage. If you are switching Mortgage Protection policies you can ask your Mortgage Lender to post you the form.
3. Send completed deed of assignment back to the bank along with your original policy documents which we send you.
4. The bank then send Notice of assignment to the insurance company directly.
5. The insurance company then confirm directly to bank that your policy is assigned.
That’s it really. I’m sure the bank will try to convince you that they will do it faster or maybe shopping elsewhere it will cause delays. –All nonsense! Just them wanting you to buy there’s! Those damn bankers!
What is an assignment?
An Assignment is the transfer by the holder of a life insurance plan (the assignor) of the benefits or proceeds of the plan to a lender (the assignee), as a collateral for a Mortgage or loan.
In the event of the death of the assignor, the assignee is paid first and the balance (if any) is paid to the plan’s beneficiary.
Banks V Brokers! Game on
Mortgage Lender/Your Bank
• Tied to only one provider so can only advice and sell you their overpriced polices.
• Your premium can form part of your mortgage so it can be hard to see exactly how much you are paying for your insurance.
• Could potentially be a problem if you decide to move Mortgage
• Bankers have a reputation for let’s say looking after themselves rather than their customers. Well they didn’t get that for no reason!
• If it’s a difficult case i.e. if there are medical issues you have no other options.
Independent Insurance brokers-Like us
• We advise on policies from all the insurance companies to provide you with the most suitable product.
• You get independent advice so you have a clear understanding of what you are getting.
• Compared to the banks policies we are better and cheaper.
• If you have any medical conditions, we can try more than one company at the same time.
• We work for you not the bank! Important point to remember.