Payment protection insurance is a form of insurance which will cover monthly loan repayments including mortgage and credit card payments, should you fall ill, lose your job or become unable to earn an income to repay the debt.
Typically the insurance will cover you for up to 12 months although some insurance companies may insure you for longer. It’s important to know that payment protection insurance doesn’t cover all illnesses, and doesn’t cover you for a pre-existing medical condition.
You may want to consider taking out payment protection insurance if you have significant mortgage or loan repayments and you want to guarantee you can still pay them should something unforeseen happen. Talking through your options with an IFA or financial adviser is usually a good idea, to see whether this is an option you should consider.
Questions you might like to ask an IFA or financial adviser…
- Will payment protection insurance cover my car repayments?
- What illnesses will I be covered for?
- What is the maximum time an insurance company will pay out for?