Importance of mortgage payment protection insurance highlighted

Published: April 17, 2008

It is ideal for borrowers to have mortgage payment protection insurance when they take out a home loan.

The security offered by the insurance can be critical for borrowers, particularly those with families.

Recent research from the Association of British Insurers shows that around 20 per cent of households had mortgage payment protection insurance in 2006.

"Having a fully protected mortgage is the ideal situation for a homeowner to be in, especially if they have a family to look after," said Joe Wiggins from Legal & General.

"Mortgage payment insurance gives peace of mind by providing a monthly payment if you can't work due to accident, illness or unemployment.

"Most people don't fully appreciate that sick pay from an employer does not last that long. Many people suffering a loss of earning would soon find that they would struggle to meet their mortgage payments, so mortgage payment insurance could make a huge difference," he added.

This is Money recently stated that mortgage payment protection insurance is not compulsory but said that "anyone with a mortgage" should consider taking it out.