Long Term Sick Pay
This helps meet your monthly
mortgage payments if you are off work for a long term due
to an accident or illness. It is usually set to start as soon
as your employer stops paying you, and pays out a monthly
amount until you are able to return to work.
Although you can use this plan just
to cover your mortgage payments it is primarily used as income
protection, therefore you can cover up to 65% of your salary,
and the income is tax free too. Most people will work out
how much they would need to pay their mortgage, utilities,
regular commitments and weekly shopping, and use that amount.
The cover is deferred to start from
when your sick pay cover provided by your employer ceases,
and it is usually set to your planned retirement date, or
the end of your mortgage. The longer that your company pays
you for, the later the policy will start to pay an income
to you, so the cheaper the premiums will be.
Premiums are also based on your occupation
class and this will depend on whether or not your job is considered
high risk. For example an office worker would be low risk
but an electrician would be a higher risk.
Waiver of premium or premium protection
is also an important option as this ensures that, for a small
increase in the monthly premium, if you were unable to work
due to accident or illness after a certain period, e.g. 6
months, the premiums would be covered. This means that you
are not in the position where you have to cancel valuable
cover when you may need it the most, because you can't afford
the premiums. In fact you would be paying the premiums back
out of what you were claiming for.
For the protection products mentioned
within this page we usually offer products from a selected
panel of providers.
Your home may be repossessed
if you do not keep up repayments on your mortgage.
Details
of our fees can be found here.
The FSA does not regulate Commercial
Mortgages or some forms of Buy to Let Mortgages.
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