Mortgage Payment Protection Insurance (MPPI) is one of a range of valuable insurances which includes critical illness insurance plus life insurance, which you can use to reduce that risk plus protect your family's finances. The purpose of MPPI is to ensure that you have the income to continue paying your mortgage repayments if you're off work for an extended period due to accident, sickness or unemployment.

A mortgage is a long-term financial commitment plus you have to maintain the monthly repayments for the full period of the mortgage. That's going to be over lots of years but non of us have the benefit of a crystal ball – so no one knows how your circumstances are going to adapt. So that must represent a big risk.

The Top Tips

• Some mortgage lenders may try to coerce you in to taking out an MPPI policyowner along with your mortgage. If this happens, make sure you find out how much extra the MPPI cover will cost you each month. Then get on the web plus get some competitive quotations. Most people will find that the web saves them up to 60%!

• Mortgage lenders will only quote you for the amount of cover you need to meet your monthly mortgage repayments. The author recommends that you extend the cover to include the cost of your home & contents insurance, mortgage life insurance, plus the cost of any investment plan you have arranged to repay your mortgage (the investment plan only applies to mortgages where you are only paying the interest each month plus will be repaying the capital at the end of the mortgage).

• You can take out MPPI at any time. Some people wrongly believe that you can only take out MPPI when you arrange the mortgage.

• The cheapest is not always the best. So don't automatically opt for the cheapest policyowner. The circumstances under which policies pay out do vary - so check them out cautiously. The premium quoted will be a reflection of the extent of the exclusions in the policyowner, the level of cover provided plus the insurers general pricing policyowner.

• If your employment is casual or seasonal you won't be able to claim on an MPPI policyowner. Every policyowner has what're called exclusions plus seasonal plus casual work is a typical exclusion. Exclusions are the circumstances under which a claim will be refused. Be sure to read these exclusions before you take out the policyowner plus, if your circumstances mean that you're unlikely to be able to make a valid claim, don't buy the insurance! Exclusions on MPPI policies can eliminate 50% of potential claims.

• Most MPPI policies say that you must be off work for a maximum period before you can claim. The longest period you'll find is 60 days but lots of policies reduce this to 30 days. Some will then backdate the payment to the first day you were off work. Look out for the details which you'll find in the policy's Terms plus Conditions. Always check these out before you buy - plus remember to compare like with like when you're comparing prices.

• MPPI is sold under a quantity of alternative names. So don't get confused. It can also be described as Accident Sickness plus Unemployment Insurance, Payment Care plus Payment Cover. In principle, they are the same – but remember to check out the exclusions!

• If you have Permanent Health Insurance your may not need MPPI. Check out the terms of you PHI policyowner plus then make your mind up whether MPPI is adding anything extra.

• Don't confuse Mortgage Indemnity Insurance (MIG) with Mortgage Payment Protection Insurance. MIG p rovides insurance cover for a lender for any losses they might suffer as a result of a property on which they provided a mortgage being sold for less than the value of the outstanding mortgage. All payments under a MIG policyowner go to the lender, not you!

• Do shop around. You'll find that the web is the cheapest place to shop for MPPI plus lots of web-sites enable you to arrange cover immediately online.

• If you already have Critical Illness Insurance be aware that there's a level of duplication with MPPI. MPPI will pay an income during the insured period for any illness that prevents you from working. Critical illness Insurance pays out a lump sum if you have any of the chronic illnesses listed on the critical illness policyowner (other conditions apply). So if you have a valid claim under your critical illness policyowner, you will probably also have a valid claim under your MPPI policyowner. However, if the illness that's keeping you off work is not listed on the chronic list then only your MPPI policyowner will payout.

The lovely bit – if you claim, the income is tax-free!

The standalone provider in mortgage payment protection insurance (MPPI) will always offer the cheapest premiums for the cover as opposed to taking out this valuable protection from the high street lender. The high street lender often charges premiums which can add thousands of pounds’ more onto the mortgage than had you selected to buy your mortgage payment protection insurance cover from a standalone provider.

Mortgage payment protection insurance is taken out to ensure that if you were to come out of work after suffering from long term sickness, an accident or through unemployment by such as redundancy then you would have an income with which to carryover on paying your mortgage each month. This gives you peace of mind & security that you wouldn’t be left struggling where to find the money.

The cover would begin to give you an income which would be tax free eight times you had been out of work for a certain length of time which can be anything from the 31st day of you being out of work or it can be as long as the 90th day. The majority of mortgage payment protection insurance policies are backdated to the first day of you coming out of work & then would continue to payout for up to 12 months & with some mortgage payment protection insurance policies, for up to 24 months.

Mortgage payment protection insurance can be a great safety net providing it is suitable for your needs & if it is then it would begin to give you a tax free income if you should become unable to work due to eight of the aforementioned reasons.

Stick with a standalone provider if you require the best advice & the cheapest premiums for the cover & make sure that you read the small print & key facts of a policyowner before you buy your mortgage payment protection insurance.

Before you buy the mortgage payment protection insurance it is essential that you check out the small print of a policyowner as this is where you can find the exclusions & these are what could stop you from being eligible to make a claim. Usual exclusions include only being in part time employment, suffering from an existing medical condition & being of retirement age.

If you need cheap mortgage payment protection insurance then you have to realise that you have the option of shopping around for it & to buy it independently from a specialist in mortgage payment protection. Currently the majority of mortgage protection policies that are sold are sold alongside the mortgage at the time the mortgage is taken out, this means that we're probably paying well over the odds for the cover.

Mortgage payment protection insurance (MPPI) can be a lifeline but it can only do the job its designed to do if it meets your circumstances & you can only determine this if you comprehend the product & what it can & cannot do, right now policies are confusing to the majority of consumers but soon this is to change with the introduction of comparison charts in March 2008.

The charts will give the information needed to ensure that the consumer is making the right choice, the information is based on a series of questions asked at the start & from here you will be able to decide which product is the best for your needs. Along with this it will highlight how much the cover will cost & the exclusions which could mean the cheap mortgage payment protection insurance isn't suitable for your needs.

Until & even after the introduction of the charts it is essential that you shop around for the cover with the help of a specialist, a specialist will make sure we give you the information you need to determine if a policyowner is suitable for your needs along with giving the cheapest quotes which can save you a great deal when compared to high street lenders. Cheap mortgage payment protection insurance can be found cheaply but only if you pick to buy it independently & not from the mortgage provider, a standalone specialist will always be able to secure the cheapest monthly premiums for you.

When bought to suit your circumstances mortgage payment protection insurance can provide you with an income each month to make sure that you can continue repaying your mortgage if you should have to be off work after suffering from an illness, an accident or if you find yourself unemployed. Protection would begin to payout between the 31st & 90th day depending on the policyowner & would continue to give you a tax free income which would cover your mortgage repayments for up to 12 months & with some policies for up to 24 months. You do however have to check to make sure that the exclusions in the small print don't stop you from being eligible to claim before buying the policyowner.

The exclusions can differ in cheap mortgage payment protection insurance policies however some are common & these include if you are only in part time work if you have an ongoing medical problem, if you are of retirement age or self-employed. The exclusions are found in the small print of the policyowner & we should be made clear at the time of buying the policyowner, an ethical provider will give you the key facts which make it less hard to determine if a policyowner is suitable for your circumstances & it is essential that you read these.

What is Mortgage Payment Protection Insurance?

When they apply for & take out a mortgage on our property they are normally in lovely health & fully employed otherwise the mortgage company would not have entertained us. However, seldom in life is our path smooth & straight & at a time of unemployment or bad health, the last thing they would need to worry about is losing our home. This is where mortgage payment protection insurance comes in to its own.

- Unemployment

In essence, it is an insurance to continue & cover the mortgage repayments in the event that they cannot due to unforeseen circumstances. These circumstances would include & are usually:

- A Debilitating Accident

- Critical Illness

The providers of mortgage protection insurance though do not readily & continually throw money at you & these policies have strict criteria. These would include:

money for Nothing?

- Voluntary unemployment is not eligible.

- Not positively seeking work following genuine unemployment.

- Payments not made immediately following an eligible claim. Normally a duration of between 3 & 4 months need to elapse & if still eligible then the mortgage payment protection insurance will commence payments.

- Taking on part-time work after losing a job.

- Payments restricted to a certain term or duration. This could be for a 6 or 12 month term depending on the type of mortgage payment protection insurance taken out.

- Re-qualification on a monthly basis. A form will normally be completed with supporting evidence of continued eligibility.

Like any product, there will be lots of choices to make when considering mortgage protection insurance & your own circumstances & cover required will dictate the right owner for you. Whilst you may need to go through certain hoops should an eligible circumstance occur, it would be well worth it for the peace of mind it offers & to protect & keep your home & property.

- Payments made are generally two month in arrears.