Don’t Let An Illness Or Unemployment Cost You Your Home
As a nation of homeowners, we are particularly vulnerable tothe effects that accident, sickness, or unemployment could haveon our ability to meet our monthly mortgage repayments.

In view of this, it is quite alarming to note that of the 11million mortgage borrowers in the UK, only 20% currently haveany form of independent insurance to protect their mortgagerepayments in the event of accident, sickness, or unemployment.

A large number of borrowers wrongly assume that State Benefitwill protect their mortgage repayments if they are off work sickor lose their jobs. But in actual fact, only 30% of people whoput in a claim for State Benefit in respect of their mortgagerepayments receive any help. This is because: - If you took outyour mortgage on or after 1 October 1995 you will not receiveany State Benefit for the first nine months of sickness orunemployment.

- If you took out your mortgage before 1 October 1995 you willnot receive any State benefit for the first two months. Afterthat, you will, subject to eligibility, receive 50% of the fullentitlement for the next four months.

- If you and/or your partner have more than £8,000 in savings,you will not receive any State benefit. Restrictions also applyif you have more than £3,000 in savings.

- If your partner works for more than 16 hours a week, you willnot be entitled to State Benefit.

Even for those who are entitled to State Benefit, thisassistance only applies to the interest element of your mortgagerepayments. Any capital repayments or any premiums forassociated life cover/savings vehicles are not covered.

If you fall behind with your mortgage repayments and cannotrepay the debt, you could end up losing your home. That’s whythe Council of Mortgage Lenders encourages all mortgageborrowers to consider taking out mortgage payment protectioninsurance - also known as accident, sickness and unemployment(ASU) cover.

This type of protection will help you to cover your mortgagerepayments and any associated insurance premiums for up to ayear

if you are unable to work due to unemployment, accident, orsickness.

- You choose the amount of cover you need per month

- You choose the type and level of cover required

- You choose how long you want to wait before claims are paid

- You pay a low monthly premium

- The policy pays a fixed monthly benefit for up to 12 months ifyou are unable to work due to accident, sickness, orunemployment.

You will normally be able to make a claim if:

- you have lost your job in circumstances beyond your control -e.g. redundancy - and are registered as unemployed, or

- you are unable to work due to a disability/illness and you areunder the regular care of a doctor or consultant.

For more information on protecting your mortgage repayments,visit the UKMortgages & Remortgages website.