Competition causes mortgage protection prices to fall
The cost of mortgage protection has fallen in recent months as a result of fierce competition from insurers. Some prices have fallen by as much as half.
The combination of ongoing improvements in medical care and continued competition between insurers has resulted in a reduction in the cost of mortgage protection insurance cover, with the price of some policies down by as much as half.
Part of the reason for the decline in the cost of cover are advances in medical science, which are keeping people alive for longer and saving insurers from paying out so frequently. However, the primary reason is competition from insurers which is driving prices down.
Mortgage protection insurance offers valuable protection by providing homeowners with the means to meet their mortgage repayments in the event of early demise before the mortgage has been repaid in full.
The sharp fall in the cost of such policies means many homeowners could make a saving by cancelling their existing cover and finding a new policy in the current market.
Research has shown that the demographic most likely to take advantage of the current market and switch providers to make a saving are couples with young children. The research has also shown that prices for mortgage protection insurance have fallen by anything from 10 to 50 per cent in the last 10 years, ensuring there are some excellent savings to be made.
The EU gender directive, which came into force last Christmas, has made it illegal for insurers to discriminate against women or men based on sex. This has seen a further fall in the cost of mortgage protection policies for men, who in general, present a greater risk to the insurer.