Mortgage Protection Insurance

Thanks Molly,

What I meant by my 2nd question was that my mortgage repayment is increased by 0.5% above the standard rate in order to cover mortgage protection. (for example 4 to 4.5%)
The documentation states that my loan approval is conditional on accepting their mortgage approval but I had heard that they couldn't insist that I take their cover and I was wondering if the price they are quoting is higher than other mortgage protection insurers.

I have tried to call LABrokers but keep getting an engaged tone!
 
Debbie 7, that's seems expensive.

I borrowed 155k, and my mortgage protection is 100 pa.

0.5% would be 775, so I am paying way, way less than 0.5% of ther loan value.

Friends of mine (married) borrowed 320k over 32 years and are paying 700 pa, still well under 0.5%.

Is this a local authority loan? I recall seeing this scenario mentioned before on AAM.
 
Consumer Credit Act 1995 renders it illegal for any lender to make a loan conditional on your taking their insurance product. But CCA 1995 only applies to residential mortgages and personal loans.

Easier to contact LABrokers by e-mail or through the web.

It's not possible to quote a "typical" cost of Mortgage Protection Life Assurance as premiums are determined by sex, age, whether or not the applicant smokes, state of health and length of the policy. A healthy 50 year old male smoker will pay over ten times as much as a healthy 25 year old male non smoker.
 
Interesting discussion on Derek Mooney's radio program today on whether Morgatage Protection Insurance is compulsary. If you are a single home buyer with no dependants and no one that you really wish to benefit in the event of your death, it does seem a bit pointless paying out for Mortgage Protection Insurance. Is it essential or a legal requirement to take out Morgatage Protection Insurance?
 
pjordan said:
If you are a single home buyer with no dependants and no one that you really wish to benefit in the event of your death,
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The lending institution benefits by taking an assignment of life policy against it thereby 'safeguarding' themselves. In the event of death the mortgage protection policy will pay off your mortgage.
 
pjordan said:
Is it essential or a legal requirement to take out Morgatage Protection Insurance?
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There are some exceptions but basically [broken link removed] makes it a legal requirement that owner occupiers take out mortgage protection life assurance..
 
Can anyone please enlighten me on this: my broker has recommended mortgage protection insurance from Irish Life. This policy would guarantee me the full loan amount regardless of where I am repaying it, should I pass away. I got the cover details today and was horrified to see that it will cost me €118.95 per month!! Having researched this thread, I have seen that insurance can be bought online for a little over €100 more for one year! (Source monitum.ie and labrokers.com). I understand that this is a "sliding scale" cover option, i.e. I am covered only up to what I owe at that particular time.

Should I ring my broker immediately and tell him I will not go ahead with his recommended option. Am I missing something with all this??

Please advise :confused:
 
Unless you have some medical condition that premium sounds crazy even for level or convertible term mortgage protection life assurance. I would suggest reading this thread:

Mortgage Protection and Mortgage Repayment Protection Policies

and then maybe ditching your broker and shopping around yourself unless he comes up with some good explanation as to why this policy and premium is in your best interests.
 
ClubMan said:
and then maybe ditching your broker
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I only intend to ditch his mortgage protection insurance advice. I am happy with everything else. How is my broker likely to react to this? I agreed to everything else on his first recommendation.
 
gebbel said:
Can anyone please enlighten me on this: my broker has recommended mortgage protection insurance from Irish Life. This policy would guarantee me the full loan amount regardless of where I am repaying it, should I pass away. I got the cover details today and was horrified to see that it will cost me €118.95 per month!! Having researched this thread, I have seen that insurance can be bought online for a little over €100 more for one year! (Source monitum.ie and labrokers.com). I understand that this is a "sliding scale" cover option, i.e. I am covered only up to what I owe at that particular time.

Should I ring my broker immediately and tell him I will not go ahead with his recommended option. Am I missing something with all this??

Please advise :confused:
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These are two very different products. As you've alluded to, one pays you the full initial loan amount on death, the other reduces and terminates with the mortgage. Hence the huge price differential.
Obviously basic mortgage protection is mandatory for most of us...personally I would go for the absolute minimum cover. I think it's a bad idea to mix what are essentially two different things-mortgage insurance and life assurance.
When my partner and I took out our first mortgage we were (in my opinion) mis-sold a policy like yours. It was costing us about €100 a month. I cancelled it after two months and got cover for €18 a month.
Remember the broker is likely to be getting a serious commission on this transaction. This site really comes into its own with this type of thing...how many people across Ireland are being given the impression that these €100 a month policies are the basic mandatory products?
 
KalEl said:
I cancelled it after two months and got cover for €18 a month.
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If you don't mind my asking: What was the sum insured?

I'm looking for 397,000 over 23 years (int-only first three years) and am being quoted from E118 to E132 pm (LABrokers and own broker)

thanks
 
AlastairSC said:
If you don't mind my asking: What was the sum insured?

I'm looking for 397,000 over 23 years (int-only first three years) and am being quoted from E118 to E132 pm (LABrokers and own broker)

thanks
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At the time it was €252,000 over 30 years for two non-smokers aged 24 and 25.
Today it's €23 for €290,000 over 25 years for two non-smokers aged 27 and 28.
Unless your much older and a smoker your qoutes sound off the wall.
I must emphasise we have the basic mandatory cover-nothing more. It clears the mortgage if one of us dies.
 
Hi Kalel,

Am interested to know why you say minimum cover is best? Myself and my boyf bought dual whole life assurance for the inital value of our mortgage (€355,000 over 30yrs) and our premium is under €70 per month - which sounded v-good to me at the time...
 
Some people recommend that you just get the bare minimum mortgage protection life assurance (i.e. the cheapest decreasing term policy that you can find) and keep general term life assurance cover separate.
 
Boylers said:
Hi Kalel,

Am interested to know why you say minimum cover is best? Myself and my boyf bought dual whole life assurance for the inital value of our mortgage (€355,000 over 30yrs) and our premium is under €70 per month - which sounded v-good to me at the time...
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I agree with Clubman...I don't see why the two should be mixed.
Think about it-minimum cover to clear the mortgage is mandatory. Why then choose an arbitary figure like you mortgage as life assurance?
Obviously factors like age and number of dependents should be considered but I'm guessing you're relatively young so why not cover the mortgage and look at other policies independently?
 
How often does the bank chase you up to ensure you still have a paid up policy? I have changed my house insurance company several times and I never hear from the EBS asking me to send them in a valid house insurance policy. Are they more stringent with mortgage protection life insurance?
 
When you apply for home insurance the form should ask if the property is mortgaged and if it is then you should say so. The insurer should then contact the lender and furnish them with a letter of indemnity.

I suspect that the lender will hear about mortgage protection life assurance lapsing or not being adequate. Either way it's prudent to make sure that both home insurance and MPLA is present and correct for your own good.
 
ClubMan said:
I suspect that the lender will hear about mortgage protection life assurance lapsing or not being adequate. Either way it's prudent to make sure that both home insurance and MPLA is present and correct for your own good.
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Absolutely, its not something people should try and avoid. It just seemed to me that they don't follow up on the house insurance but as you said maybe the insurance company does this for you.
 
Should have given all my details before - we're looking for 420,000 cover over 23 years. Ages 48 and 46, both non-smokers. 2 dependents. Best quote we've got is Monitum: about E1500 per year with E1200 refunded after 2 months. LA Brokers about the same net cost - 300-400 per year.

Broker is quoting 130 pm but no refunds!

Given others' posts is this too much? Surely quotes from the onlines must be the best available?
 
AlastairSC said:
Should have given all my details before - we're looking for 420,000 cover over 23 years. Ages 48 and 46, both non-smokers. 2 dependents. Best quote we've got is Monitum: about E1500 per year with E1200 refunded after 2 months. LA Brokers about the same net cost - 300-400 per year.

Broker is quoting 130 pm but no refunds!

Given others' posts is this too much? Surely quotes from the onlines must be the best available?
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I don't understand...how is a one off dropsy of €1200 from a premium of €1500 better than a premium of €300-400?
 
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