Insurance is a type of policy whereby you pay premiums to protect yourself against certain events. At The Contractor Mortgage Company, we offer telephone based advice on all type of insurances for contractors who are applying for a contractor mortgage. Even if you are already covered, we may be able to find you a cheaper policy to save you money. Below we explain each insurance for your information.
This is a policy put in place to protect your home and its contents. Depending on the type of policy you require, the building can be insured against events such as accidental damage, damage by flooding or fire, damage by weather (such as torrential rain or earthquakes), vandalism, freezing or bursting of pipes, falling trees or lampposts, subsidence or impact from vehicles or aircraft. Contents insurance will cover your personal possessions within the property that are damaged or stolen.
This type of policy is designed to help you keep up with your mortgage repayments if you find yourself without a job or are made redundant. It will cover against sudden illness, accident, injury or redundancy. This only covers mortgage repayments.
Permanent Health Insurance (PHI), also known as Accident, Sickness and Unemployment cover (ASU) is a policy designed to cover your income, mortgage payments and/or any outstanding loan payments should you become unable to work due to accident, sickness or unemployment (i.e. redundancy). It differs from MPPI because MPPI will only cover your mortgage repayments.
This type of policy is designed to cover you for any medical expenses that are not covered by the NHS, or for procedures that you want to be done privately due to NHS waiting lists. You can benefit from more prompt treatment in a private hospital or dental surgery if you opt for dental cover. They usually cover out-patient visits, surgery and many other medical expenses such as the costs for equipment. You can opt for various levels of cover depending on your requirements.
This is an insurance that will pay out a sum of money in the event of a death. For the purposes of contractor mortgages, the insured person would usually be someone who is paying the mortgage so that if they were to die, a lump sum would be paid out by the insurance company. This can then be used to repay the mortgage to lighten the burden on any remaining people such as family, and avoid them from being evicted due to non-payment of monthly mortgage costs.
You can also opt for a Family Income Benefit policy which would pay out monthly rather than a single lump sum. This is usually put in place for families with children so that if one of the parents dies, the other will still receive an income to support the family.
Critical Illness Cover (CIC) is a policy which covers you in the event that you have one of the serious illnesses listed in the policy terms. The insurer will usually cover a selected list of serious illness, and will pay out a lump sum to cover the costs associated with the illness, such as operations or changes to your property if you become disabled. You can use the lump sum however you wish.
Struggling to get to grips with mortgage related terms? Use our quick-reference guide to help you.