This type of insurance provides monthly payment to help cover your mortgage repayments when you are unable to work due to a sickness or injury, so you and your family can remain in your home. This protects your ownership of your home and prevents the risk of you defaulting on your loan.
ACC only covers you (80% of income up to $2,066.58 weekly) when you are injured but illnesses are not covered. Only roughly 20% of long term claims are accident related, meaning 80% of cases are actually not covered by ACC, leaving many people in a tight spot with little to no support. We think Mortgage Repayment Insurance is important as a protection for you to continue enjoying a quality lifestyle.
First, check out an insurance company that provides Mortgage insurance covers or speak to an adviser. Cigna, Partners Life, AIA are some of the larger brands that offer this cover. A number of banks will also offer a version of this cover, alongside smaller specialised providers.
Second, you can get a quote online or with an adviser to understand how much cover you should think about getting. Compare quotes from different providers and choose the best package for you. Many Mortgage Repayment Insurances stop at a fixed amount which means if you have a high mortgage you will need to make additional arrangements.
Third, complete an application form and have your personal medical history, as well as your family’s ready. Insurers will need to take some time to assess your medical history to understand risks and what can and can't be covered under your policy. You may also be asked for information about your mortgage loan, so documents related to this can come in handy.
Fourth, check that you have an Enduring Power of Attorney who has the legal rights to make decisions on your finances, health and welfare on your behalf for when you are seriously ill and cannot receive any income.
Lastly, check that your insurance cover is still right for you every 12 months or if you have any changes to your mortgage, income or lifestyle. It can be easy to set up and forget, but it is worthwhile to adjust your policy regularly so you can get the most out of it.
Quashed is an online platform that makes it easy for you to manage and track all your insurance in one place. You’ll be prompted at the right time to check on your insurance and it helps you keep track of how your premiums are increasing each year.
The cost of your premium is different with each provider and they don't all follow the same guidelines when it comes to calculating costs. Premiums are the on-going payments you make to continue your cover and protection. Below are some of the common factors used in the industry that will play a part in determining your premium.
Cover type and amount: The more comprehensive, in terms of additional benefits and add-ons, the more it covers and so the higher the premium cost.
Number of policyholders: If you add your partner to your Mortgage Repayment Insurance policy and sign up as a couple, you can expect to pay a higher premium as the benefits extend to both people now.
Your age: This relates to the risk of you suffering an illness or injury that allows you to claim your policy. The older your age, the more risk is associated with you suffering health complications that prevent you from working and so the higher your premium will be.