Spectrum FA Guide to Mortgage Protection Insurance UK

What is mortgage protection insurance? Find out everything you should know about protecting your mortgage in our guide to mortgage protection insurance UK.

Mortgage Protection Insurance UK


  1. Spectrum FA Guide to Mortgage Protection Insurance UK
  2. What is Mortgage Protection Insurance?
  3. How Do Mortgage Protection Policies Work?
  4. Types of Mortgage Protection Policy 
  5. Mortgage Term Assurance
  6. Decreasing Mortgage Term Assurance
  7. Mortgage Critical Illness Insurance
  8. What Illnesses/Conditions Will Be Covered?
  9. Decreasing Mortgage Critical Illness Insurance
  10. How Much Does Mortgage Protection Insurance Cost?
  11. Who Should Have Mortgage Protection Insurance & Why?
  12. How Can Spectrum FA Help You with Mortgage Protection?

Spectrum FA Guide to Mortgage Protection Insurance UK

Highly experienced and knowledgeable in all types and aspects of personal protection insurance, Spectrum FA are experts in helping families across the UK secure their homes with mortgage protection policies. But what is mortgage protection insurance, how does it work and what other options are there to make sure your family is not rendered homeless by your death or a critical illness? Find out everything you should know about protecting your mortgage in our comprehensive guide to mortgage protection insurance UK.

Would you like to learn more about mortgage protection and/or other types of personal protection insurance? Contact us now – our advisors will be happy to answer all your questions.

What is Mortgage Protection Insurance?

Consisting either of life insurance policies to which critical illness and total permanent disability (TPD) cover can be added or independent critical illness policies, mortgage protection cover ensures your family has the financial resources to pay off your mortgage and/or other outstanding debts (i.e. loans, credit card bills, etc.) in the event of your (or another insured family member’s) death or, depending on the selected cover, critical illness diagnosis.

Would your family be able to repay your mortgage/other loans if anything unexpected should happen to you? Make sure they can – request a free review (no obligation) of your specific needs today.

How Do Mortgage Protection Policies Work?

Taken out as single (policyholder only) or joint (policyholder and a spouse/partner or other named person) policies, mortgage protection policies pay out a lump sum in the event of a named (insured) individual passing away or becoming critically ill (if selected).

The family can then use this lump sum to repay any outstanding balance on their mortgage and/or other debts. There are several different types of mortgage protection policy (see below), but policyholders are able to choose the:

  • Cover level, i.e. the amount to be paid out; setting this high enough to ensure adequate funds to repay a mortgage/other loans is therefore crucial.
  • Policy’s term, or duration, which depends on your mortgage’s term and is usually set at 5 to 50 years, to match the term of the mortgage.
  • Add-ons/optional extras you wish to include. In addition to critical illness cover, many policies also offer many other optional benefits you may or may not choose to include.

Without expert advice, finding a policy that matches your specific needs can be complex and at times confusing. Guiding you through every step of the process, Spectrum FA will advise you on a suitable policy that matches your needs and requirements. Contact us now to learn how.

Types of Mortgage Protection Policy

Different mortgage protection policy types that are available to homeowners include:

  • Mortgage Term Assurance
  • Decreasing Mortgage Term Assurance
  • Mortgage Critical Illness Insurance
  • Decreasing Mortgage Critical Illness Insurance

The following chapters will explain each of these policy types in a little more detail.

Not sure which type of policy will best meet your requirements? Allow us to assist – request a no-obligation review of your circumstances now.

Mortgage Term Assurance

Mortgage term (or level term mortgage) assurance policies are the most suitable option for homeowners with interest-only mortgages where only accrued interest is covered by their monthly payments and the full originally borrowed amount becomes payable when the mortgage reaches the end of its term.

There is also the option to add critical illness (see below for illnesses and conditions likely to be covered) and total permanent disability (TPD) cover, as well as other optional extras. These policies can provide the certainty in that their premiums and cover remain fixed throughout their term.

Find out if this is the right option for you by requesting a free, no-obligation Spectrum FA review now.

Decreasing Mortgage Term Assurance

Homeowners with decreasing term/repayment mortgages where monthly payments cover both accrued interest and reduce the mortgage’s overall outstanding balance over the years, would be better served with a decreasing mortgage term policy.

Here, the provided level of cover decreases, usually in line with the mortgage’s decreasing balance, although premiums, which are typically not as expensive as those of level term mortgage protection policies, remain the same throughout the policy’s term.

Again, policyholders will get the option to add critical illness cover (learn more about potentially covered illnesses/conditions below) as well as other optional extras.

Is this the right type of policy for you? Request a no-obligation review (free of charge) of your unique needs by an experienced advisor now to make sure it is.

Mortgage Critical Illness Insurance

Most suitable for families with interest-only mortgages, term (or level term) critical illness policies make a lump sum payment in the event of an insured person (policyholder, spouse/partner or another named individual) being diagnosed with a specified critical illness (please see below for details).

As with level term mortgage insurance, term critical illness policies have fixed cover levels that remain the same over the term of the plan. The policyholder will also have the option to include a number of add-ons.

Unsure whether term critical illness cover is the right solution for you or which optional add-ons/extras to select? Allow Spectrum FA to assist – request your free review today.

What Illnesses/Conditions Will Be Covered?

Most policies provide cover for a set of standard conditions as laid out by the ABI (Association of British Insurers). For example:

  • Kidney failure
  • Coronary artery bypass grafts
  • Major organ transplants
  • Multiple sclerosis
  • Major heart attacks
  • Stroke
  • Multiple specific cancers (which are defined within policies’ terms & conditions)

In addition, many policies provide cover (either as part of their standard range or as optional extras) for a range of other conditions/illnesses including, for example:

  • Aorta graft surgery, bacterial meningitis and/or respiratory failure (usually advanced stage only)
  • Aplastic anaemia, liver failure (usually advanced stage only) and/or motor neurone disease
  • Benign brain tumours, total permanent disability and/or open heart surgery (which usually includes median sternotomy)
  • Dementia, Alzheimer’s disease and/or permanent blindness
  • CJD (Creutzfeldt-Jakob Disease), loss of speech (if permanent) and/or Parkinson’s disease
  • Cardiomyopathy, deafness (if permanent) and/or replacements/repairs of heart valves
  • Coma (& permanent symptoms associated therewith) and/or multiple system atrophy (if permanent)
  • Encephalitis and/or HIV (if an infection resulted from a physical assault, blood transfusion or work accident)
  • Permanent loss of your foot/hand, progressive supranuclear palsy (if permanent) and/or removal/loss of your eyeball
  • Primary pulmonary hypertension, systemic lupus erythematosus (if severe complications are experienced) and/or permanent paralysis (total) of a limb
  • Spinal strokes and/or third degree burns (if 20% of your face, head or body surface area are covered)
  • Stroke with long-lasting (minimum of 24 hrs) symptoms and/or traumatic brain injuries

The terms & conditions of any given policy will specify precisely which (if any) of these illnesses/conditions will be covered. Many policies also offer cover for other optional conditions and/or other optional extras or add-ons. Please contact Spectrum FA for more detailed information on this.

Decreasing Mortgage Critical Illness Insurance

Like decreasing term mortgage (life) insurance policies, a decreasing term critical illness policy is most suitable for homeowners with decreasing term/repayment mortgages.

Again, the level of cover provided gradually decreases in correspondence with the decreasing mortgage balance.

Covering conditions/illnesses as detailed above, these policies may also offer a number of add-ons/optional extras. Contact us to learn more.

How Much Does Mortgage Protection Insurance Cost?

Mortgage protection premiums depend on your selected:

  • Type of policy (i.e. level/decreasing term life or critical illness; joint or single)
  • Cover level
  • Term (duration)
  • Add-ons/optional extras

When calculating your premiums, insurers will also take various other factors into account, including your/any other named individual’s:

  • Age – An older person is generally considered to be at a higher risk of developing an illness or pass away than a younger one. Premiums will reflect this increased risk.
  • Medical History – An extensive history of medical problems could suggest a higher likelihood of an applicant developing illnesses, so premiums will be higher, too.

Being a smoker will also affect premiums, as can participating in high risk leisure activities/sports like:

  • Hang-gliding, parachuting and scuba diving
  • Surfing, horse riding & motorsports
  • High impact sports (rugby, boxing, hockey/ice hockey, etc.)
  • Mountaineering, rock climbing & bungee or base jumping

Premiums also vary between different providers. Considering all this, obtaining expert advice to find a suitable policy is essential. Spectrum FA will advise on a suitable policy to match your needs. Get in touch to learn how.

Who Should Have Mortgage Protection Insurance & Why?

Most families’ mortgages/mortgage payments are dependent on one or more regular incomes. Losing one of these incomes due to an unexpected death or a specified critical illness could make it impossible to keep up with payments/pay off a mortgage.

Unless suitable contingency plans are in please, this could ultimately put a family’s ability to keep and remain in their home at risk.

Getting suitable protection is therefore a must for anyone with a mortgage. We can help you to protect your family from having to go through the fear and worry of potentially losing their home at what is already an extremely stressful and traumatic time. Contact us now to discover how.

How Can Spectrum FA Help You with Mortgage Protection?

Combining in-depth mortgage protection knowledge, years of experience in this area and access to leading UK insurers’ most reliable policies, we can help you obtain a suitable policy to protect your mortgage (and consequently your family’s future) at premiums that are competitively priced.

Fully understanding that everyone’s circumstances and needs are unique, we offer a completely tailored service and will recommend a suitable policy that matches your individual needs and circumstances.

Do you have a mortgage? Get in touch with our advisors today to learn more about mortgage protection/other personal protection options and request your free, no obligation review.