Mortgage Protection Insurance Products

Initial Disclosure Document

• Mortgage Protection Insurance
• Unemployment Insurance
• Sickness & Accident Insurance
• Income Protection Insurance (PHI)

In the case of a couple, the death of either borrower before redemption can result in severe financial hardship for the survivor. If the main income earner dies - how will the survivor afford the continuing repayments?

Mortgage protection policies are available to repay the outstanding capital balance of the mortgage in the event of either death or critical illness during the mortgage term, and are written on a joint life basis where appropriate. The comparatively low cost of the policy brings added peace of mind and financial security in the event of a premature death or diagnosis of a critical illness.

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Redundancy is a major threat to the ability to maintain mortgage repayments. Social security provision is no longer as helpful as it used to be. Before October 1995, home owners qualified for income support on mortgage interest of 50% after only eight weeks off work and 100% after 26 weeks. Since then, the benefits have been lower and not available for the first 39 weeks of redundancy or sickness.

Therefore, people who took out their mortgages on or after October 1995 have a significant need for redundancy and sickness/PHI cover. Those whose mortgages were taken out before the October 1995 regulations are still entitled to the pre-October social security benefit level.
Note:if remortgaging then the benefit is lost and the rules after Oct 1995 apply.

Only 38% of new borrowers since October 1995 has taken out mortgage payment protection insurance. Trident, the mortgage payment protection insurance we provide, has been designed to provide payment protection for your mortgage, loans or your housing rent, supporting you and your family during a time of need so that you can concentrate on getting yourself back to work as quickly as possible.

Should anything happen to you then you can rest assured that Trident will cover your benefit payments until you are able to return to work or 12 monthly payments have been made.

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Sickness and accident cover, which is very often an added feature of redundancy cover, matches the need for short-term income to be used for repaying the mortgage each month, usually for up to two years.

The claim amount is usually payable direct to the lender rather than to the claimant. These policies are renewable at the insurer's option and should not be looked upon as a long-term solution to replacing lost income in order to meet the mortgage payments.

For long term protection permanent health insurance (PHI) is required.

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Permanent health insurance probably costs a little more than sickness and accident cover, but meets the need for long-term income replacement. A PHI policy will pay an income benefit to the policy holder during disability caused by sickness and injury. Benefit starts at the end of an initial waiting period that is usually tied in to an employers sick pay scheme . The benefit is payable until the policyholder returns to work, dies or the policy term expires, whichever is the earlier.