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When you have
invested so much into purchasing your home, you should be aware of
the variety of insurance products available for mortgage protection.
Only building and content insurance coverage is compulsory upon
receiving a mortgage. However there are several other types of
insurance available to protect your home in case an unexpected event
prevents you from making your mortgage payments.
The most widely utilized mortgage protection insurance is currently
the critical illness policy. This product will ensure that should
you fall victim to a serious illness you would be issued one tax
free lump sum payment upon your diagnosis that can be used to pay
off your mortgage. These are usually conditions such as cancer or a
heart attack, but your policy will dictate they consider a serious
There is also the mortgage life insurance policy that will cover
your mortgage debt in the unfortunate event of death. Life cover
policies can adjust the rate of coverage as the balance due on your
mortgage in reduced by monthly payments the coverage amount will
reduce as well. There is also the option of a level life cover which
is usually a bit more expensive however your level of coverage
remains the same regardless of your mortgage balance.
Accident, sickness and unemployment insurance is exactly as it
sounds. In the event that you should have an accident, become too
ill to work or become involuntarily unemployed your mortgage will be
paid. It is important to keep in mind when choosing this insurance
that it will only pay out for up to two years so the benefits may
run out prior to your mortgage being paid regardless of if your
situation with health or employment has changed.
Finally there is income protection coverage. This type of policy
will offer protection should you become sick or disabled for an
extended period of time. Permanent income protection insurance will
continue to pay monthly benefits until either you may return to
work, or when your policy expires, which is generally once the
mortgage has been paid in full.
The purchase of a home is the most significant purchase that most of
us will ever make. It is just as important that you protect your
family from unforeseen circumstances that could jeopardize the
security of your home. There are a number of products available to
assure that you can rest easy knowing you are protected.