se they are at the limit of their budget already. This can lead to a ‘catch twenty two’ situation where payment protection is advisable, but unaffordable!

Good policies will cover any bills related to your loan or mortgage - including interest and repayments. But anyone with a mortgage or loan should consider taking it out unless you are absolutely secure in your job or you are not going to have a serious accident!

Generally, a good Payment Protection

Should I have this type of insurance?

Payment Protection Insurance is not compulsory, although it can be a condition of some loans. Payment protection is a voluntary debt cancellation program which can cancel your loan balance or your monthly loan payment. The fee is based on the monthly outstanding loan balance and can be added to the monthly payment or even at the end of the loan period in some circumstances. You can get policies which cover bills, other than mortgages, in the event of illness or unemployment - such as credit card and car loan payments.

Whilst you are in good health and have a job, paying off your home loan or mortgage might not be a worry to you.

Consider though, what if your circumstances changed overnight. Maybe you lose your job or have an accident that leaves you unable to work. A loan for your home, auto or other major purchase could represent a significant burden on your family if you were to become disabled or even die. Not being able to make the mortgage or other loan payments could make a difficult situation even worse for your family.

Many people never consider Payment Protection Insurance when taking out their home loan. Many think that they will be able to rely on your savings or maybe help from the State to pay the mortgage if you are unable to work - but research has revealed that for the most borrowers would find that these routes would be inadequate to cover the loan payments.

It is considered that for people who might have stretched themselves financially with a mortgage or with loans, it is probably even more important to be covered in the event of unforeseen unemployment.

The downside is that premiums can be expensive and adds to the cost of the loan. People who are stretching themselves to meet the loan costs tend to opt out of payment protection insurance because they are at the limit of their budget already. This can lead to a ‘catch twenty two’ situation where payment protection is advisable, but unaffordable!

Good policies will cover any bills related to your loan or mortgage - including interest and repayments. But anyone with a mortgage or loan should consider taking it out unless you are absolutely secure in your job or you are not going to have a serious accident!

Generally, a good Payment Protection p

er than mortgages, in the event of illness or unemployment - such as credit card and car loan payments.

Whilst you are in good health and have a job, paying off your home loan or mortgage might not be a worry to you.

Consider though, what if your circumstances changed overnight. Maybe you lose your job or have an accident that leaves you unable to work. A loan for your home, auto or other major purchase could represent a significant burden on your family if you were to become disabled or even die. Not being able to make the mortgage or other loan payments could make a difficult situation even worse for your family.

Many people never consider Payment Protection Insurance when taking out their home loan. Many think that they will be able to rely on your savings or maybe help from the State to pay the mortgage if you are unable to work - but research has revealed that for the most borrowers would find that these routes would be inadequate to cover the loan payments.

It is considered that for people who might have stretched themselves financially with a mortgage or with loans, it is probably even more important to be covered in the event of unforeseen unemployment.

The downside is that premiums can be expensive and adds to the cost of the loan. People who are stretching themselves to meet the loan costs tend to opt out of payment protection insurance because they are at the limit of their budget already. This can lead to a ‘catch twenty two’ situation where payment protection is advisable, but unaffordable!

Good policies will cover any bills related to your loan or mortgage - including interest and repayments. But anyone with a mortgage or loan should consider taking it out unless you are absolutely secure in your job or you are not going to have a serious accident!

Generally, a good Payment Protection

ly if you were to become disabled or even die. Not being able to make the mortgage or other loan payments could make a difficult situation even worse for your family.

Many people never consider Payment Protection Insurance when taking out their home loan. Many think that they will be able to rely on your savings or maybe help from the State to pay the mortgage if you are unable to work - but research has revealed that for the most borrowers would find that these routes would be inadequate to cover the loan payments.

It is considered that for people who might have stretched themselves financially with a mortgage or with loans, it is probably even more important to be covered in the event of unforeseen unemployment.

The downside is that premiums can be expensive and adds to the cost of the loan. People who are stretching themselves to meet the loan costs tend to opt out of payment protection insurance because they are at the limit of their budget already. This can lead to a ‘catch twenty two’ situation where payment protection is advisable, but unaffordable!

Good policies will cover any bills related to your loan or mortgage - including interest and repayments. But anyone with a mortgage or loan should consider taking it out unless you are absolutely secure in your job or you are not going to have a serious accident!

Generally, a good Payment Protection

hese routes would be inadequate to cover the loan payments.

It is considered that for people who might have stretched themselves financially with a mortgage or with loans, it is probably even more important to be covered in the event of unforeseen unemployment.

The downside is that premiums can be expensive and adds to the cost of the loan. People who are stretching themselves to meet the loan costs tend to opt out of payment protection insurance because they are at the limit of their budget already. This can lead to a ‘catch twenty two’ situation where payment protection is advisable, but unaffordable!

Good policies will cover any bills related to your loan or mortgage - including interest and repayments. But anyone with a mortgage or loan should consider taking it out unless you are absolutely secure in your job or you are not going to have a serious accident!

Generally, a good Payment Protection

se they are at the limit of their budget already. This can lead to a ‘catch twenty two’ situation where payment protection is advisable, but unaffordable!

Good policies will cover any bills related to your loan or mortgage - including interest and repayments. But anyone with a mortgage or loan should consider taking it out unless you are absolutely secure in your job or you are not going to have a serious accident!

Generally, a good Payment Protection policy will start to pay one month after you are out of work (either through illness or job loss). Generally, policies pay out for 12 months. It is thought that people will have found other employment or recovered from illness within this period. However, some policies will cover up to 120 months payments – normally within a set amount say, for example, up to $120,000. This, of course, is likely to be reflected in the cost of the premiums.

Most insurers will cover either the main income provider or include a second person named on the loan or mortgage.

Once you tell your provider that you're out of work and this is verified, your insurance payments should begin, typically after around one month without a salary. It is usual in most cases that payments are made directly to your mortgage/ lender, although in some cases payments are made to the customer.

Most people tend to buy Payment Protection Insurance from their mortgage/ lender at the time of the transaction or if they go through a broker/adviser - through that broker.

However, Payment Protection Insurance can be bought as a stand-alone product from any provider. Watch out for lenders who insist that you should take their insurance. Go elsewhere and shop around.

Whilst the author endeavours to ensure the accuracy of the information contained within this article, you are reminded that this is only a guide and you should always check with local professional before undertaking any work based herein.